Unrivaled Brands (UNRVD) 10-Q 8 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 05, 2018
Document And Entity Information
Entity Registrant Name	Terra Tech Corp.
Entity Central Index Key	1,451,512
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		79,190,002
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2,018
Entity Emerging Growth Company	false
Entity Small Business	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)		Sep. 30, 2018	Dec. 31, 2017
Current Assets:
Cash		$ 3,418,991	$ 5,445,582
Accounts Receivable		890,123	959,698
Notes Receivable			5,010,143
Inventory		3,599,066	5,760,019
Assets Held for Sale		856,233
Prepaid Expenses and Other Current Assets		781,373	1,067,689
Total Current Assets		9,545,786	18,243,131
Property, Equipment and Leasehold Improvements, Net		36,888,848	19,191,616
Intangible Assets, Net		20,411,936	27,773,110
Goodwill		35,172,508	28,921,260
Other Assets		630,200	4,058,682
Other Investments		11,995,379
TOTAL ASSETS		114,644,657	98,187,799
Current Liabilities:
Accounts Payable and Accrued Expenses		5,492,742	5,444,710
Derivative Liabilities		2,222,000	9,331,400
Total Current Liabilities		7,714,742	14,776,110
Long-Term Liabilities:
Long-Term Debt, Net of Discounts		13,828,345	6,609,398
Total Long-Term Liabilities		13,828,345	6,609,398
Total Liabilities		21,543,087	21,385,508
COMMITMENTS AND CONTINGENCIES (Note 15)
STOCKHOLDERS' EQUITY:
Common Stock, Par Value 0.001: 990,000,000 Shares Authorized as of September 30, 2018 and December 31, 2017; 77,913,801 and 61,818,560 Shares Issued and Outstanding as of September 30, 2018 and December 31, 2017, respectively (1)	[1]	77,914	61,819
Additional Paid-In Capital (1)	[1]	232,528,404	181,357,715
Accumulated Deficit		(140,678,329)	(105,548,602)
Total Terra Tech Corp. Stockholders' Equity		91,927,989	75,870,932
Non-Controlling Interest		1,173,581	931,359
Total Stockholders' Equity		93,101,570	76,802,291
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		114,644,657	98,187,799
Convertible Series A Preferred Stock
STOCKHOLDERS' EQUITY:
Preferred Stock, Value
Convertible Series B Preferred Stock
STOCKHOLDERS' EQUITY:
Preferred Stock, Value
[1]	Adjusted to reflect the one for 15 reverse stock split. See "Note 1 "Description of Business."

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
STOCKHOLDERS' EQUITY:
Common stock, par value	$ 0.001	$ 0.001
Common stock, Authorized	990,000,000	990,000,000
Common stock, Issued	77,913,801	61,818,560
Common stock, Outstanding	77,913,801	61,818,560
Convertible Series A Preferred Stock
STOCKHOLDERS' EQUITY:
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, Authorized	100	100
Preferred stock, Issued	12	8
Preferred stock, Outstanding	12	8
Convertible Series B Preferred Stock
STOCKHOLDERS' EQUITY:
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, Authorized	49,999,900	49,999,900
Preferred stock, Issued	0	0
Preferred stock, Outstanding	0	0

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Consolidated Statements Of Operations
Total Revenues		$ 7,083,225	$ 10,121,375	$ 24,416,768	$ 24,788,704
Cost of Goods Sold		5,559,520	7,786,437	19,037,200	20,588,330
Gross Profit		1,523,705	2,334,938	5,379,568	4,200,374
Selling, General and Administrative Expenses		9,404,945	6,238,110	25,829,863	18,653,697
Loss from Operations		(7,881,240)	(3,903,172)	(20,450,295)	(14,453,323)
Other Income (Expense):
Amortization of Debt Discount		(498,961)	(490,068)	(1,384,641)	(1,616,338)
Impairment of Property			(138,037)		(138,037)
Loss on Extinguishment of Debt		(4,257,029)	(1,373,538)	(12,115,752)	(4,052,133)
Gain (Loss) on Fair Market Valuation of Derivatives		(103,600)	(1,475,900)	524,400	1,122,050
Interest Expense, Net		(425,160)	(119,650)	(1,016,160)	(407,993)
Share of Loss in Joint Venture		(439,354)		(439,354)
Loss on Fair Market Valuation of Contingent Consideration					(4,426,047)
Gain on Settlement of Contingent Consideration					4,991,571
Total Other Income (Expense)		(5,724,104)	(3,597,193)	(14,431,507)	(4,526,927)
Net Loss		13,605,344	(7,500,365)	(34,881,802)	(18,980,250)
Net Income (Loss) Attributable to Non-Controlling Interest		64,460	292,568	247,925	(621,560)
NET LOSS ATTRIBUTABLE TO TERRA TECH CORP.		$ (13,669,803)	$ (7,792,933)	$ (35,129,726)	$ (18,358,690)
Net Loss Per Common Share Attributable to Terra Tech Corp. Common Stockholders – Basic and Diluted	[1]	$ (0.19)	$ (0.16)	$ (0.51)	$ (0.44)
Weighted-Average Number of Common Shares Outstanding – Basic and Diluted	[1]	73,213,387	48,024,423	68,917,828	41,610,209
[1]	Adjusted to reflect the one for 15 reverse stock split. See "Note 1 "Description of Business."

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss	$ (34,881,802)	$ (18,980,250)
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:
Gain on Fair Market Valuation of Derivatives	(524,400)	(1,122,050)
Loss on Fair Market Valuation of Contingent Consideration		4,426,047
Loss on Joint Venture	439,354
Cancellation of shares issued	(117,831)
Gain on Settlement of Contingent Consideration		(4,991,571)
Impairment of Property		138,037
Loss on Extinguishment of Debt	12,115,752	4,052,133
Amortization of Debt Discount	1,384,641	1,616,338
Interest Income Accreted	(155,783)
Depreciation and Amortization	2,597,794	2,687,994
Warrants Issued with Common Stock and Debt		211,534
Stock Issued for Compensation	589,959	1,526,286
Stock Issued for Director Fees	99,991	221,973
Stock Issued for Services	133,587	1,036,427
Stock Option Compensation	1,645,384	439,599
Changes in Operating Assets and Liabilities:
Accounts Receivable	69,575	81,486
Inventory	2,042,395	(2,458,684)
Prepaid Expenses and Other Current Assets	(155,740)	(3,817,699)
Other Assets	(52,612)	(185,611)
Accounts Payable and Accrued Expenses	359,353	2,300,098
Income Tax Payable		(57,971)
NET CASH USED IN OPERATING ACTIVITIES	(14,410,383)	(12,875,884)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash Paid for Acquisition, Net of Cash Acquired		(4,113,779)
Purchase of Equity Investments	(7,087,713)
Purchase of Property, Equipment and Leasehold Improvements	(9,797,439)	(1,947,057)
NET CASH USED IN INVESTING ACTIVITIES	(16,885,152)	(6,060,836)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Issuance of Notes Payable	25,050,000	11,500,000
Debt Issuance Cost	(942,000)	(360,000)
Proceeds from Issuance of Common Stock	5,100,000	6,700,000
Payment of Contingent Consideration		(2,088,000)
Proceeds from Exercise of Warrants	101,000
Cash (Distribution) Contribution from Non-Controlling Interest	(5,794)	86,546
NET CASH PROVIDED BY FINANCING ACTIVITIES	29,303,206	15,838,546
NET CHANGE IN CASH	(1,992,329)	(3,098,174)
NET CHANGE IN CASH CLASSIFIED WITHIN CURRENT ASSETS HELD FOR SALE	(34,262)
Cash at Beginning of Period	5,445,582	9,749,572
CASH AT END OF PERIOD	3,418,991	6,651,398
SUPPLEMENTAL DISCLOSURE FOR OPERATING ACTIVITIES:
Cash Paid for Interest	428,334
SUPPLEMENTAL DISCLOSURE FOR NON-CASH INVESTING AND FINANCING ACTIVITIES:
Settlement of Contingent Consideration		4,739,638
Purchase of Land and Building with a Mortgage	6,500,000
Gain on Settlement of Contingent Consideration Recorded Against Additional Paid-In Capital		4,692,697
Fair Value of Debt Discount and Derivative liability Recorded	12,686,000	7,881,000
Fair Market Value of Common Stock Issued Upon Conversion	42,968,230	18,156,952
Claw back of Escrow Shares From The Tech Center Drive Asset Acquisition	351,072
Issuance of Common Stock for Other Assets	200,000
Fair Value of Warrants Issued for Debt Discount	817,536	169,225
Deposits Applied to the Purchase of Property	3,500,000
Assets Classified as Held for Sale	856,233
Fair Vlaue of Shares Issued for Acquisition		2,726,146
Fair Value of Shaes Issued for Production Operating Agreement		1,935,500
Conversion of Series B Preferred Stock to Common Stock		33,146
Reclass of Non-Controlling Interest to Additional Paid-In Capital for the Acquisition of Additional Interest in Subsidiary		1,830,925
Share of Loss on Joint Venture	$ 439,354

DESCRIPTION OF BUSINESS

DESCRIPTION OF BUSINESS	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 1 - DESCRIPTION OF BUSINESS	Organization References in this document to “the Company”, “Terra Tech”, “we”, “us”, or “our” are intended to mean Terra Tech Corp., individually, or as the context requires, collectively with its subsidiaries on a consolidated basis. The Company is a vertically integrated retail, production and cultivation company with an emphasis on providing the highest quality of medical and adult use cannabis products. The Company also holds an exclusive patent on an organic antioxidant rich Superleaf lettuce and sells living herbs grown using classic Dutch hydroponic farming methods. The Company has a presence in three states (California, Nevada and New Jersey), and, currently, has cannabis operations in California and Nevada. All the Company’s cannabis dispensaries operate under the name Blüm. The Company’s cannabis dispensaries offer a broad selection of medical and adult use cannabis products including flowers, concentrates and edibles. On March 12, 2018, the Company implemented a 1-for-15 reverse stock split of the Company’s common stock (the “Reverse Stock Split”). The Reverse Stock Split became effective in the stock market upon commencement of trading on March 13, 2018. As a result, every fifteen shares of the Company’s Pre-Reverse Stock Split common stock were combined and reclassified into one share of the Company’s common stock. The number of common stock shares subject to outstanding options, warrants and convertible securities were also reduced by a factor of fifteen as of March 13, 2018. All historical share and per share amounts reflected throughout unaudited consolidated financial statements have been adjusted to reflect the Reverse Stock Split. The authorized number of shares and the par value per share of the Company’s common stock were not affected by the Reverse Stock Split.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Basis of Presentation The accompanying interim unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Securities Exchange Commission (“SEC”) Form 10-Q and Article 10 of Regulation S-X of the Securities Act of 1933 and reflect the accounts and operations of the Company and those entities in which we have a controlling financial interest. In accordance with the provisions of the Financial Accounting Standards Board (“FASB”) or Accounting Standards Codification (“ASC”) 810, “Consolidation” All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. These interim unaudited consolidated financial statements do not include all disclosures required by GAAP for complete financial statements and, therefore, should be read in conjunction with the more detailed audited consolidated financial statements for the year ended December 31, 2017. The December 31, 2017 balances reported herein are derived from the audited consolidated financial statements for the year ended December 31, 2017. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. Non-Controlling Interest Non-controlling interest is shown as a component of stockholders’ equity on the consolidated balance sheets and the share of net income (loss) attributable to non-controlling interest is shown as a component of net income (loss) in the consolidated statements of operations. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the financial statements and the reported amounts of total net revenue and expenses in the reporting periods. The Company regularly evaluates estimates and assumptions related to revenue recognition, allowances for doubtful accounts, sales returns, inventory valuation, stock-based compensation expense, goodwill and purchased intangible asset valuations, derivative liabilities, deferred income tax asset valuation allowances, uncertain tax positions, tax contingencies, litigation and other loss contingencies. These estimates and assumptions are based on current facts, historical experience and various other factors that the Company believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. The actual results the Company experiences may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected. The Company continues to evaluate the impact of adult use legalization in California on its sales forecasts. Certain of the Company’s assets, such as goodwill, may be negatively impacted if the Company were to decrease its California sales forecasts. Investments Investments in unconsolidated affiliates are accounted for under the cost or the equity method of accounting, as appropriate. The Company accounts for investments in limited partnerships or limited liability corporations, whereby the Company owns a minimum of 5% of the investee's outstanding voting stock, under the equity method of accounting. These investments are recorded at the amount of the Company's investment and adjusted each period for the Company's share of the investee's income or loss, and dividends paid. As investments accounted for under the cost method do not have readily determinable fair values, the Company only estimates fair value if there are identified events or changes in circumstances that could have a significant adverse effect on the investment's fair value. Assets Held for Sale Assets held for sale represent furniture, equipment, and leasehold improvements less accumulated depreciation as well as any other assets that are held for sale in conjunction with the sale of a business. The Company recorded assets held for sale in accordance with ASC 360 , “Property, Plant, and Equipment,” Goodwill Goodwill is measured as the excess of consideration transferred and the net of the acquisition date fair value of assets acquired, and liabilities assumed in a business acquisition. In accordance with ASC 350, “Intangibles—Goodwill and Other,” The Company reviews the goodwill allocated to each of our reporting units for possible impairment annually during the third quarter and whenever events or changes in circumstances indicate its carrying amount may not be recoverable. When assessing goodwill for impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, the Company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the Company performs a two-step impairment test. If the Company concludes otherwise, then no further action is taken. The Company also has the option to bypass the qualitative assessment and only perform a quantitative assessment, which is the first step of the two-step impairment test. In the two-step impairment test, the Company measures the recoverability of goodwill by comparing a reporting unit’s carrying amount, including goodwill, to the estimated fair value of the reporting unit. There were no events or changes in circumstances that indicated potential impairment of intangible assets during the third quarter 2018, as such the Company determined that no adjustment to the carrying value of goodwill was required. Revenue Recognition and Performance Obligations On January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers” Under the new standard, the Company recognizes a sale as follows: Cannabis Dispensary, Cultivation and Production The Company recognizes revenue from manufacturing and distribution product sales when our customers obtain control of our products. Revenue from our retail dispensaries is recorded at the time customers take possession of the product. Revenue from our retail dispensaries is recognized net of discounts, rebates, promotional adjustments, price adjustments and returns, and net of taxes collected from customers that are remitted to governmental authorities, with the collected taxes recorded as current liabilities until remitted to the relevant government authority. Upon purchase, the Company has no further performance obligations and collection is assured as sales are paid for at time of purchase. Revenue related to distribution customers is recorded when the customer is determined to have taken control of the product. This determination is based on the customer specific terms of the arrangement and gives consideration to factors including, but not limited to, whether the customer has an unconditional obligation to pay, whether a time period or event is specified in the arrangement and whether the Company can mandate the return or transfer of the products. Revenue is recorded net of taxes collected from customers that are remitted to governmental authorities with collected taxes recorded as current liabilities until remitted to the relevant government authority. Herbs and Produce Products The Company recognizes revenue from products grown in its greenhouses upon delivery of the product to the customer at which time control passes to the customer. Upon transfer of control, the Company has no further performance obligations. For sales for which the Company uses an outside grower, the Company evaluates whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions. The evaluation considers whether the Company takes control of the products of the outside grower, whether it has the ability to direct the outside grower to provide the product to the customer on its behalf or whether it combines products from the outside grower with its own goods and services to provide the products to the customer. In evaluating whether it takes control of the products of the outside grower, the Company considers whether it has primary responsibility for fulfilling the promise to provide the products, whether the Company is subject to inventory risk related to the products and whether it has the ability to set the selling prices for the products. Disaggregation of Revenue See “Note 17 – Segment Information” Contract Balances Due to the nature of the Company’s revenue from contracts with customers, the Company does not have material contract assets or liabilities that fall under the scope of ASC Topic 606. Contract Estimates and Judgments The Company’s revenues accounted for under ASC Topic 606, generally, do not require significant estimates or judgments based on the nature of the Company’s revenue streams. The sales prices are generally fixed at the point of sale and all consideration from contracts is included in the transaction price. The Company’s contracts do not include multiple performance obligations or material variable consideration. Fair Value of Financial Instruments The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has not elected the fair value option to measure any eligible financial instruments. Derivative Financial Instruments ASC 815-40, “Derivatives and Hedging” ASC 815, “Derivatives and Hedging” The Company estimates the fair value of any new derivative liabilities using the Monte Carlo Simulation (“MCS”) technique because it provides for the necessary assumptions and inputs. The MCS technique, which is an option-based model, is a generally accepted valuation technique for valuing embedded conversion features in convertible notes because it is an open-ended valuation model that embodies all significant assumption types and ranges of assumption inputs that the Company agrees would likely be considered in connection with the arms-length negotiation related to the transference of the instrument by market participants. In addition to the typical assumptions in a closed-end option model, such as volatility and a risk-free rate, MCS incorporates assumptions for interest risk, credit risk and redemption behavior. In addition, MCS breaks down the time to expiration into, potentially, a large population of time intervals and steps. However, there may be other circumstances or considerations, other than those addressed herein, that relate to both internal and external factors that would be considered by market participants as it relates specifically to the Company and the subject financial instruments. The effects, if any, of these considerations cannot be reasonably measured, quantified or qualified. Recently Adopted Accounting Standards FASB ASU No. 2014-09 (Topic 606), “Revenue from Contracts with Customers” “Revenue from Contracts with Customers “Revenue from Contracts with Customers” FASB ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)” “Statement of Cash Flows.” FASB ASU 2017-09, “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting” - Recently Issued Accounting Standards FASB ASU No. 2018-13 (Topic 820), “Fair Value Measurement” – Conceptual Framework for Financial Reporting—Chapter 8: Notes to Financial Statements FASB ASU No. 2018-07 (Topic 718), “Compensation—Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting” – FASB ASU 2017-01 (Topic 805), “Business Combinations: Clarifying the Definition of a Business” Business Combinations (Topic 805), Clarifying the Definition of a Business Revenue from Contracts with Customers FASB ASU 2017-11,”Earnings Per Share, Distinguishing Liabilities from Equity, Derivatives and Hedging – (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” – FASB ASU 2017-04 (Topic 350), “Intangibles - Goodwill and Others” FASB ASU No. 2016-02 (Topic 842), “Leases” Leases Leases: Targeted Improvements

CONCENTRATIONS OF BUSINESS AND

CONCENTRATIONS OF BUSINESS AND CREDIT RISK	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 3 - CONCENTRATIONS OF BUSINESS AND CREDIT RISK	California Licensed Vendors Requirement The Company sources cannabis products for retail, cultivation and production from various vendors. However, as a result of the new regulations in the State of California, the Company’s California retail, cultivation and production operations must use vendors licensed by the State effective January 1, 2018. As a result, the Company will be dependent upon the licensed vendors in California to supply products as of that date. If the Company is unable to enter into a relationship with sufficient members of properly licensed vendors, the Company's sales may be impacted. During the three and nine months ended September 30, 2018 and 2017, we did not have any concentration of vendors for inventory purchases. However, this may change depending on the number of vendors who receive appropriate licenses to operate in the State of California. California Phase-In of Laboratory Testing Requirements The Bureau of Cannabis Control (“BCC”) is the lead agency in developing regulations for medical and adult use cannabis in California. The BCC is responsible for licensing retailers, distributors, testing labs and microbusinesses. Prior to July 1, 2018, the BCC allowed for a “transition period” in which they allowed exceptions from specific regulatory provisions. However, beginning July 1, 2018, cannabis goods must meet all statutory and regulatory requirements. A licensee can only sell cannabis goods that have been tested by a licensed testing laboratory and have passed all statutory and regulatory testing requirements. In order to be sold, cannabis goods harvested or manufactured prior to January 1, 2018, must be tested by a licensed testing laboratory and must comply with all testing requirements in Section 5715 of the BCC’s regulations. Cannabis goods that do not meet all statutory and regulatory requirements must be destroyed in accordance with the rules pertaining to destruction. The laboratory testing requirements are being phased-in three tiers. Tiers 1, 2 and 3 have compliance deadlines of January 1, 2018, July 1, 2018 and December 31, 2018, respectively. With each phased-in tier, there are specific laboratory testing requirements for different types of cannabis products as outlined below: Phase-In of Required Laboratory Testing Inhalable Cannabis Inhalable Cannabis Products Other Cannabis & Cannabis Products Tier 1 January 1, 2018 Cannabinoids Testing x x x Moisture Content Testing x Category II Residual Solvents and Processing Chemicals Testing x x Category I Residual Pesticides Testing x x x Microbial Impurities Testing (A. fumigatus, A. flavus, A. niger, A. terreus) x x Microbial Impurities Testing (Escherichia coli and Salmonella spp.) x x x Homogeneity Testing of Edible Cannabis Products x Tier 2 July 1, 2018 Category I Residual Solvents and Processing Chemicals Testing x x Category II Residual Pesticides Testing x x x Foreign Material Testing x x x Tier 3 December 31, 2018 Terpenoids Testing x x x Mycotoxins Testing x x x Heavy Metals Testing x x x Water Activity Testing of Solid or Semi-Solid Edibles x x On June 8, 2018 the BCC issued new guidance regarding the completion of the transition period from an unregulated to regulated state market. This guidance was provided to issue direction on how licensees should treat inventory from 2017 and 2018, which was not completely compliant with the BCC regulations that commenced on January 1, 2018. One of these components was that, in addition to tier 1 testing, all products must meet tier 2 testing by July 1, 2018 and tier 3 testing by December 31, 2018. While testing has not been a barrier to product availability for the Company, it is possible that as the market transitions from tier 2 to tier 3 testing, products meeting all three tier testing requirements will be limited in nature. Through industry discussions, the Company believes that cultivators and manufacturers are aware of the new requirements and are taking great measures to meet these requirements. Considering that other states have similar testing requirements, the Company does not expect that these new testing standards will be an actual barrier to product availability. However, the limited number of testing labs licensed by the state to perform all required tier testing may cause a backlog or delay in testing results, which could have an impact on product availability.

ASSETS HELD FOR SALE

ASSETS HELD FOR SALE	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 4 - ASSETS HELD FOR SALE	As of September 30, 2018, there was one asset group in the Cannabis Dispensary, Cultivation and Production segment that met the criteria to be recorded as held for sale under ASC 360: (1) management, having the authority to approve the action, committed to a plan to sell the asset, (2) the asset group was available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets, (3) an active program to locate a buyer and other actions required to complete the plan to sell the asset group have been initiated, (4) the sale of the asset group was probable, and transfer of the asset group was expected to qualify for recognition as a completed sale, within one year, (5) the asset group was being actively marketed for sale at a price that is reasonable in relation to its current fair value, and (6) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. The assets related to this asset group have been classified as held for sale on the unaudited September 30, 2018 consolidated balance sheet. On July 6, 2018, MediFarm LLC, a majority owned subsidiary of the Company, entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Exhale Brands Nevada III, LLC (the “Purchaser”) pursuant to which the Company agreed to sell and the Purchaser agreed to purchase substantially all of the assets of the Company related to the Company’s dispensary located at 1921 Western Ave., Las Vegas, NV 89102 (the “Business”). The aggregate consideration to be paid for the Business is $6,250,000 plus the value of inventory, as agreed upon by the Company and the Purchaser, less the liabilities assumed at closing. The transaction is subject to approval by the Nevada Department of Taxation and is expected to close promptly following receipt of such approval. There is no material relationship between the Company or its affiliates and the Purchaser other than in respect of the transactions contemplated by the Purchase Agreement. The Purchase Agreement contains customary conditions, representations, warranties, indemnities and covenants by, among, and for the benefit of the parties. See “Note 19 – Subsequent Events” The components of assets held for sale are as follows: September 30, 2018 Cash $ 34,262 Inventory 173,637 Prepaid Expenses and Other Assets 35,905 Property, Equipment and Leasehold Improvements, Net 612,429 Assets Held for Sale $ 856,233

VARIABLE INTEREST ENTITY ARRANG

VARIABLE INTEREST ENTITY ARRANGEMENTS	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 5 - VARIABLE INTEREST ENTITY ARRANGEMENTS	The Company has a shared interest in two entities, MediFarm I and MediFarm I RE, with another investor for the operation of a cultivation operation and dispensary in Nevada. The Company has determined these entities are variable interest entities in which the Company is the primary beneficiary by reference to the power and benefits criterion under ASC 810, “Consolidation.” As the primary beneficiary of MediFarm I and MediFarm I RE, the Company consolidates the accounts and operations of these entities. All intercompany transactions are eliminated in the unaudited consolidated financial statements. The aggregate carrying values of MediFarm I and MediFarm I RE assets and liabilities, after elimination of any intercompany transactions and balances, in the consolidated balance sheets were as follows: September 30, December 31, 2018 2017 Current Assets: Cash $ 172,130 $ 409,029 Inventory 650,283 232,231 Prepaid Expenses and Other Current Assets 40,067 302,186 Total Current Assets 862,480 943,446 Property, Equipment and Leasehold Improvements, Net 1,849,782 1,965,103 TOTAL ASSETS $ 2,712,262 $ 2,908,549 Current Liabilities: Accounts Payable and Accrued Expenses $ 424,006 $ 319,853 TOTAL LIABILITIES $ 424,006 $ 319,853

INVESTMENTS IN UNCONSOLIDATED A

INVESTMENTS IN UNCONSOLIDATED AFFILIATES	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 6 – INVESTMENTS IN UNCONSOLIDATED AFFILIATES	NuLeaf On October 26, 2017, the Company entered into joint venture agreements with NuLeaf Sparks Cultivation, LLC and NuLeaf Reno Production, LLC (collectively “NuLeaf”) to build and operate cultivation and production facilities for our IVXX brand of cannabis products in Nevada. The agreements were subject to approval by the State of Nevada, the City of Sparks and the City of Reno in Nevada. Under the terms of the agreements, the Company remitted to NuLeaf an upfront investment of $4,500,000 in the form of convertible loans bearing an interest rate of 6% per annum. On June 28, 2018, the Company received approval from the State of Nevada. The remaining required approvals from local authorities were received in July 2018. As a result, the notes receivable balance was converted into a 50% ownership interest in NuLeaf. The investment in NuLeaf was recorded at cost and accounted for using the equity method. As of September 30, 2018, the $7.13 million investment in NuLeaf was recorded in other assets on the unaudited consolidated balance sheet. For the three and nine month period ended September 30, 2018, the Company recorded $0.44 million loss in earnings in the unaudited consolidated statement of operations. Hydrofarm On August 28, 2018, the Company entered into a Subscription Agreement with Hydrofarm Holdings Group, Inc. (“Hydrofarm”), one of the leading independent providers of hydroponic products in North America, pursuant to which the Company agreed to purchase from Hydrofarm and Hydrofarm agreed to sell to the Company 2,000,000 Units, each Unit consisting of one share of common stock and one warrant to purchase one-half of a share of common stock for an initial exercise price of $5.00 per share, for $2.50 per Unit for an aggregate purchase price of $5,000,000. The $5,000,000 investment in Hydrofarm was recorded at cost and is included in other assets on the unaudited consolidated balance sheet as of September 30, 2018.

ACQUISITIONS

ACQUISITIONS	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 7 – ACQUISITIONS	Tech Center Drive On September 13, 2017, MediFarm So Cal Inc. (“MediFarm So Cal”), a wholly-owned subsidiary of the Company acquired all assets of Tech Center Drive LLC (“Tech Center Drive”), and majority control of 55 OC Community Collective Inc (“55 OC”). The acquisition of Tech Center Drive and 55 OC was accounted for in accordance with ASC 805-10, “ Business Combinations. During the third quarter of 2018, the Company recorded a $6.3 million adjustment to reflect the fair value of the management services agreement. The adjustment resulted in an increase to goodwill, a decrease in other intangible assets and a $434,114 decrease in amortization expense. The measurement period was closed during the third quarter of 2018. The following table summarizes the fair value of the assets at the date of acquisition: Assets Acquired Inventory $ 113,779 Property, Equipment and Leasehold Improvements 99,566 Security Deposits 5,000 Management Service Agreement 370,332 Goodwill 6,258,260 Total Assets Acquired $ 6,846,937

INVENTORY

INVENTORY	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 8 – INVENTORY	Raw materials consist of Edible Garden’s herb product lines and material for IVXX’s line of cannabis pure concentrates. Work-in-progress consists of live plants grown for Edible Garden’s herb product lines and live plants grown at Black Oak Gallery (“Black Oak”). Finished goods consists of IVXX’s line of cannabis packaged products to be sold into dispensaries and Black Oak cannabis products sold in retail, and Edible Garden’s products to be sold via food, drug, and mass channels. Inventory consists of the following: September 30, December 31, 2018 2017 Raw Materials $ 1,210,885 $ 1,450,273 Work-in-Progress 794,216 1,016,596 Finished Goods 1,593,965 3,293,150 Total Inventory $ 3,599,066 $ 5,760,019

PROPERTY, EQUIPMENT AND LEASEHO

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 9 - PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET	Property, equipment, and leasehold improvements, net consists of the following: September 30, December 31, 2018 2017 Land and Building $ 19,662,334 $ 9,047,201 Furniture and Equipment 3,522,960 3,553,587 Computer Hardware and Software 657,088 486,176 Leasehold Improvements 8,435,062 9,316,665 Construction in Progress 9,922,155 1,204,547 Subtotal 42,199,599 23,608,176 Less Accumulated Depreciation (5,310,751 ) (4,416,560 ) Property, Equipment and Leasehold Improvements, Net $ 36,888,848 $ 19,191,616 Depreciation expense related to property, equipment and leasehold improvements for the three months ended September 30, 2018 and 2017 was $417,132 and $479,686, respectively, and for the nine months ended September 30, 2018 and 2017 was $1,487,869 and $1,399,418, respectively.

NOTES PAYABLE

NOTES PAYABLE	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 10 - NOTES PAYABLE	Notes payable consists of the following: September 30, December 31, 2018 2017 Senior convertible promissory note dated August 21, 2017, issued to accredited investors, which matures February 21, 2019 and bears interest at a rate of 12% per annum. The conversion price is $4.50, subject to adjustment. The balance of the note and accrued interest was converted into common stock in January 2018. $ - $ 640,010 Senior convertible promissory note dated December 26, 2017, issued to accredited investors, which matures June 26, 2019 and bears interest at a rate of 12% per annum. The conversion price is $4.50, subject to adjustment. The balance of the note and accrued interest was converted into common stock in January 2018. - 1,469,388 Promissory note dated November 22, 2017, issued for the purchase of real property. Matures December 1, 2020, with an option to extend the maturity date 1 year. The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.5%. In the event of default, the note is convertible at the holder's option. 4,500,000 4,500,000 Promissory note dated January 18, 2018, issued for the purchase of real property. The promissory note is collateralized by the land and building purchased and matures February 1, 2021, with an option to extend the maturity date 1 year. The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.0%. The full principle balance and accrued interest are due at maturity. In the event of default, the note is convertible at the holder's option. 6,218,286 - Senior convertible promissory note dated July 25, 2018, issued to accredited investors under the 2018 Master Securities Purchase and Convertible Promissory Notes Agreement, which matures January 25, 2020 and bears interest at a rate of 7.5% per annum. The conversion price is $4.50, subject to adjustment. 2,394,774 - Securities Purchase Agreement dated July 25, 2018, issued to accredited investors, which matures July 25, 2019 and bears interest at a rate of 3.0% per annum. The conversion price is 5.0% discount to the average of the three (3) lowest VWAPs in the five (5) trading days prior to the conversion date. 134,398 - Senior convertible promissory note dated September 6, 2018, issued to accredited investors under the 2018 Master Securities Purchase and Convertible Promissory Notes Agreement, which matures March 7, 2020 and bears interest at a rate of 7.5% per annum. The conversion price is $4.50, subject to adjustment. 580,887 - Long-Term Debt, Net of Discounts $ 13,828,345 $ 6,609,398 Total debt as of September 30, 2018 and December 31, 2017 was $13,828,345 and $6,609,398, respectively, net of unamortized debt discount of $2,039,942 and $4,790,601, respectively. The senior convertible promissory notes are convertible at the holder’s option into shares of common stock. There was accrued interest payable of $10,212 and $21,767 as of September 30, 2018 and December 31, 2017, respectively. Promissory Notes On January 18, 2018, the Company entered into a $6,500,000 promissory note for the purchase of land and a building in California with a third-party creditor. As part of the closing of the purchase of land, the Company issued warrants with a value of approximately $164,000 and paid a cash fee of $195,000. The warrants and cash fee were recorded as a debt discount. The unamortized balance of such discount as of September 30, 2018 was $281,714. The interest rate for the first year is 12.0% and increases 0.5% per year, up to 13.0%, through 2021. Payments of interest only are due monthly. The full principle balance and accrued interest are due at maturity. 2018 Master Securities Purchase and Convertible Promissory Notes Agreement In March 2018, the Company entered into the 2018 Master Securities Purchase Agreement with an accredited investor pursuant to which the Company sells to the accredited investor 7.5% Senior Convertible Promissory Notes in eight tranches of $5,000,000, for a total of $40,000,000. For each note issued under the 2018 Master Securities Purchase Agreement, the principal and interest due and owed under the note is convertible into shares of Common Stock at any time at the election of the holder at a conversion price per share equal to the lower of (i) the original conversion price as defined in each note issuance or (ii) 87% of the average of the two lowest daily volume weighted average price of the Common Stock in the thirteen (13) trading days prior to the conversion date (“Conversion Price”). The Conversion Price is subject to adjustment for (i) stock splits, stock dividends, combinations, or similar events and (ii) full ratchet anti-dilution protection. Upon certain events of default, the conversion price will automatically become 70% of the average of the three (3) lowest volume weighted average prices of the Common Stock in the twenty (20) consecutive trading days prior to the conversion date for so long as such event of default remains in effect. In addition, at any time that (i) the daily volume weighted average price of the Common Stock for the prior ten (10) consecutive trading days is $10.50 or more and (ii) the average daily trading value of the Common Stock is greater than $2,500,000 for the prior ten (10) consecutive trading days, then the Company may demand, upon one (1) day’s notice, that the holder convert the notes at the Conversion Price. The Company may prepay in cash any portion of the outstanding principal amount of the notes and any accrued and unpaid interest by, upon ten (10) days’ written notice to the holder, paying an amount equal to (i) 110% of the sum of the then-outstanding principal amount of the notes plus accrued but unpaid interest, if the prepayment date is within 90 days of the issuance date of the notes; (ii) 115% of the sum of the then-outstanding principal amount plus accrued but unpaid interest, if the prepayment date is between 91 days and 180 days of the issuance date of the notes; or (iii) 125% of the sum of the then-outstanding principal amount of the notes plus accrued but unpaid interest, if the prepayment date is after 180 days of the issuance date of the notes. In September 2018, the Company issued a 7.5% convertible note for an aggregate value of $4,900,000. In September 2018, $3,900,000 plus interest was converted into 2,774,876 shares of the Company’s common stock. There were no fees or expenses deducted from the net proceeds received by the Company in the offerings. The Company paid $147,000 in cash and issued approximately $107,000 of warrants in connection with the notes. The cash fee and warrants were recorded as a debt discount and fully amortized upon conversion of the note into shares of the Company’s common stock. In July 2018, the Company issued a 7.5% convertible note for an aggregate value of $5,000,000. In September 2018, $1,000,000 plus interest was converted into 743,030 shares of the Company’s common stock. There were no fees or expenses deducted from the net proceeds received by the Company in the offerings. The Company paid $150,000 in cash and issued approximately $120,000 of warrants in connection with the notes. The cash fee and warrants were recorded as a debt discount and fully amortized upon conversion of the note into shares of the Company’s common stock. In June 2018, the Company issued a 7.5% convertible note for an aggregate value of $5,000,000. During the nine months ended September 30, 2018, $5,000,000 plus interest was converted into 3,032,007 shares of the Company’s common stock. There were no fees or expenses deducted from the net proceeds received by the Company in the offerings. The Company paid $150,000 in cash and issued approximately $114,000 of warrants in connection with the notes. The cash fee was recorded as a debt discount and warrants. During the period ended March 31, 2018, the Company issued a 7.5% convertible note for an aggregate value of $5,000,000. In April 2018, $5,000,000 plus accrued interest was converted into 2,538,856 shares of the Company’s common stock. There were no fees or expenses deducted from the net proceeds received by the Company in the offerings. The Company paid $150,000 in cash and issued approximately $116,000 of warrants in connection with the notes. The cash fee and warrants were recorded as a debt discount and fully amortized upon conversion of the note into shares of the Company’s common stock. 2017 Master Securities Purchase and Convertible Promissory Notes Agreement The Company has a Securities Purchase Agreement with an accredited investor pursuant to which the Company sells to the accredited investor Senior Convertible Promissory Notes. During the year ended December 31, 2017, the Company issued five 12% convertible notes for an aggregate value of $20,000,000 due at various dates through June 2019. Of the $20,000,000 convertible notes issued during 2017, the Company converted $13,100,000 of the convertible notes into shares of the Company’s common stock during the year ended December 31, 2017. As of December 31, 2017, $6,900,000 principal, gross of the unamortized debt discount of $4,790,602 remained due. The convertible notes outstanding as of December 31, 2017 were all converted in January 2018. In January 2018, the Company issued a 12% convertible note for an aggregate value of $5,000,000. Of the $5,000,000 convertible note issued in January, the Company converted all of the convertible note during the nine months period ended September 2018. As of September 30, 2018, the related unamortized debt discount was completely amortized. There were no fees or expenses deducted from the net proceeds received by the Company in the offerings. The Company paid $150,000 in cash and issued approximately $196,000 of warrants in connection with the notes. The cash fee and warrants issued were recorded as a debt discount. Conversion of Notes Payable and Related Loss on Extinguishment of Debt During the three and nine months ended September 30, 2018 and 2017, the Company converted debt and accrued interest into shares of the Company’s common stock. The table below details the conversion of the notes payable into equity, the loss on extinguishment of debt and value of the Company’s common stock issued in conversion of debt for the three and nine months ended September 30, 2018 and 2017: Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Fair market value of common stock issued upon conversion $ 13,041,469 $ 6,424,597 $ 42,968,230 $ 18,156,952 Principal amount of debt converted (8,900,000 ) (3,250,000 ) (26,800,000 ) (11,814,324 ) Accrued interest converted (118,041 ) (232,225 ) (311,320 ) (506,985 ) Fair value of derivative at conversion date (3,699,000 ) (3,434,900 ) (19,271,000 ) (9,106,950 ) Debt discount value at conversion date 3,932,601 1,866,066 15,529,842 7,323,440 Loss on extinguishment of debt $ 4,257,029 $ 1,373,538 $ 12,115,752 $ 4,052,133 Common Stock Issued Upon Conversion (1) 6,111,043 1,668,902 13,414,287 5,769,600 (1)

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 11 - FAIR VALUE MEASUREMENTS	Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis The following tables set forth the financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy as of the dates indicated: Fair Value at September 30, Fair Value Measurement Using Description 2018 Level 1 Level 2 Level 3 Derivative Liabilities – Conversion Feature $ 2,222,000 $ - $ - $ 2,222,000 $ 2,222,000 $ - $ - $ 2,222,000 Fair Value at December 31, Fair Value Measurement Using Description 2017 Level 1 Level 2 Level 3 Derivative Liabilities – Conversion Feature $ 9,331,400 $ - $ - $ 9,331,400 $ 9,331,400 $ - $ - $ 9,331,400 The following table presents a reconciliation of the derivative liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3): For the Nine Months Ended September 30, 2018 2017 Balance at December 31, 2017 $ 9,331,400 $ 6,987,000 Change in Fair Market Value of Conversion Feature (524,400 ) (1,122,050 ) Derivative Debt Converted into Equity (19,271,000 ) (9,106,950 ) Fair Value of Derivative Liability Recorded Upon Issuance of Convertible Debt 12,686,000 7,881,000 Balance at September 30, 2018 $ 2,222,000 $ 4,639,000 For the Three Months Ended September 30, 2018 2017 Balance at June 30, 2018 $ 1,891,400 $ 3,163,000 Change in Fair Market Value of Conversion Feature 103,600 1,475,900 Derivative Debt Converted into Equity (3,699,000 ) (3,434,900 ) Fair Value of Derivative Liability Recorded Upon Issuance of Convertible Debt 3,926,000 3,435,000 Balance at September 30, 2018 $ 2,222,000 $ 4,639,000 Effective as of June 2018, the Company estimates the fair value of any new derivative liabilities using the Monte Carlo Simulation (“MCS”) technique because it provides for the necessary assumptions and inputs. The MCS technique, which is an option-based model, is a generally accepted valuation technique for valuing embedded conversion features in convertible notes, because it is an open-ended valuation model that embodies all significant assumption types, and ranges of assumption inputs that the Company agrees would likely be considered in connection with the arms-length negotiation related to the transference of the instrument by market participants. In addition to the typical assumptions in a closed-end option model, such as volatility and a risk-free rate, MCS incorporates assumptions for interest risk, credit risk and redemption behavior. In addition, MCS breaks down the time to expiration into potentially a large population of time intervals and steps. However, there may be other circumstances or considerations, other than those addressed herein, that relate to both internal and external factors that would be considered by market participants as it relates specifically to the Company and the subject financial instruments. The effects, if any, of these considerations cannot be reasonably measured, quantified or qualified. Significant inputs into the Monte Carlo Simulation used to calculate the derivative values are as follows: September 2018 Stock Price $1.76 - $2.88 Conversion and Exercise Price $1.41 - $2.29 Annual Dividend Yield 0% Expected Life (Years) 0.82 - 1.50 Risk-Free Interest Rate 2.32% - 2.70% Expected Volatility 94.00% - 104.30% For derivative liabilities issued prior to June 2018, the Company estimates the fair value of the derivative liabilities using the Black-Scholes-Merton option pricing model using the following assumptions for issuances during the period ended: Stock Price $2.08 - $6.90 Conversion and Exercise Price $1.98 - $6.60 Annual Dividend Yield 0% Expected Life (Years) 0.41 - 2.42 Risk-Free Interest Rate 1.77% - 2.81% Expected Volatility 62.36% - 103.43% Volatility is based on historical volatility of our common stock. Historical volatility was computed using weekly pricing observations for our common stock that correspond to the expected term. This method produces an estimate that is representative of our expectations of future volatility over the expected term of these warrants and conversion features. No financial assets were measured on a recurring basis as of September 30, 2018 and December 31, 2017.

TAX EXPENSE

TAX EXPENSE	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 12 - TAX EXPENSE	For the three and nine months ended September 30, 2018 and 2017, the Company had no income tax expense (benefit). The components of deferred income tax assets and (liabilities) are as follows: September 30, December 31, 2018 2017 Deferred Income Tax Assets: Net Operating Losses $ 12,471,322 $ 8,023,000 12,471,322 8,023,000 Deferred Income Tax Liabilities: Depreciation (933,048 ) (850,000 ) Total 11,538,274 7,173,000 Valuation Allowance (11,538,274 ) (7,173,000 ) Net Deferred Tax $ - $ - The Tax Cuts and Jobs Act (the “Tax Act”) was enacted on December 22, 2017, and permanently reduces the U.S. federal corporate tax rate from 35% to 21%, effective January 1, 2018. For the nine months ended September 30, 2018, there have not been any adjustments made to these estimates. The Company is still analyzing the Tax Act and refining its calculations, which could potentially impact the measurement of its tax balances. The Company expects to complete its analysis within the measurement period in accordance with SAB No. 118. For the three and nine months ended September 30, 2018 and 2017, the Company had subsidiaries that produced and sold cannabis or cannabis pure concentrates, subjecting the Company to the limits of Internal Revenue Code (“IRC”) Section 280E. Pursuant to IRC Section 280E, the Company is allowed only to deduct expenses directly related to sales of product. The State of California does not conform to IRC Section 280E and, accordingly the Company is allowed to deduct all operating expenses on its California income tax returns. As the Company files consolidated federal income tax returns, the taxable income generated from its subsidiaries subject to IRC Section 280E has been offset by losses generated by operations not subject to IRC Section 280E. During 2017, Company amended income tax returns of our subsidiary Black Oak for the periods prior to acquisition, which resulted in a net tax refund in 2017. Permanent tax differences include ordinary and necessary business expenses deemed by the Company as non-allowable deductions under IRC Section 280E; non-deductible expenses for interest, derivatives and warrant expense related to debt financings and non-deductible losses related to various acquisitions. As of September 30, 2018 and December 31, 2017, the Company had net operating loss carryforwards of approximately $40,106,668 and $26,333,000, respectively, which, if unused, will expire beginning in the year 2034. These tax attributes are subject to an annual limitation from equity shifts, which constitute a change of ownership as defined under IRC Section 382, which will limit their utilization. The Company has assessed the effect of these limitations and does not believe these losses to be substantially limited. The Company also has deferred tax liabilities from the excess carrying amounts of the basis of depreciable assets for financial reporting purposes. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative losses incurred in 2017 and through the nine months period ended September 30, 2018. Such objective evidence limits the ability to consider other subjective evidence, such as our projections for future growth. On the basis of this evaluation, as of September 30, 2018, a valuation allowance of $11,538,274 has been recorded against all net deferred tax assets as these assets are more likely than not to be unrealized. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence such as our projections for growth. The Company files income tax returns in the U.S. federal jurisdiction and various state and local jurisdictions. All tax years from 2014 to 2017 are subject to examination.

EQUITY

EQUITY	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 13 - EQUITY	Common Stock During the nine months ended September 30, 2018, senior secured convertible promissory notes and accrued interest in the amount of $42,968,230 were converted into 13,414,287 shares of common stock. During the nine months ended September 30, 2018, the Company sold 2,166,205 shares of common stock for the net amount of $5,100,000 pursuant to an equity financing facility with an accredited investor. During the nine months ended September 30, 2018, the Company cancelled 24,510 shares of common stock valued at $117,831, issued 49,982 shares of common stock for services performed in the amount of $133,587 issued 188,138 shares of common stock for compensation in the amount of $589,959 and 49,500 shares of common stock for directors’ fees in the amount of approximately $100,000. During the nine months ended September 30, 2018, the Company issued 252,703 shares of common stock for cashless and cash exercises of warrants. The cash received from the cash exercise of warrants was $101,000. During the nine months ended September 30, 2018, the Company purchased an asset worth $300,000. In March 2018, the Company paid $100,000 cash and the remaining $200,000 was paid by issuing 53,332 shares of the Company’s common stock. During the nine months ended September 30, 2018, as part of the stock split in March 2018, the Company issued 46,687 shares of common stock to round up fractional shares to all shareholders of the Company. During the nine months ended September 30, 2018, as part of the acquisition of Tech Center Drive in September 2017, the Company issued shares held in escrow which were to be paid six months after the acquisition date subject to any amounts to be withheld related to working capital type adjustments. As a result of the working capital adjustments, in March 2018, on the six-month anniversary date, the Company withheld and cancelled 101,083 shares valued at $351,072.

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 14 - STOCK-BASED COMPENSATION	2016 Equity Incentive Plan In the first quarter of 2016, the Company adopted the 2016 Equity Incentive Plan. The following table contains information about the 2016 Equity Incentive Plan as of September 30, 2018: Awards Reserved for Issuance Awards Issued Awards Available for Grant 2016 Equity Incentive Plan 30,000,000 2,552,731 27,447,269 Stock Options The following table summarizes the Company’s stock option activity and related information for the three and nine months ended September 30, 2018: Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Life Aggregate Intrinsic Value of In-the-Money Options Options Outstanding as of Janury 1, 2018 1,177,732 $ 2.17 Options Granted 800,000 $ 4.41 Options Exercised - - Options Forfeited - - Options Expired - - Options Outstanding as of March 31, 2018 1,977,732 $ 3.08 9.1 Years $ 522,600 Options Exercisable as of Mach 31, 2018 659,774 $ 2.20 8.5 Years $ 391,950 Options Granted 66,667 $ 3.75 Options Exercised - - Options Forfeited - - Options Expired - - Options Outstanding as of June 30, 2018 2,044,399 $ 3.10 8.89 Years $ 361,800 Options Exercisable as of June 30, 2018 828,941 $ 2.38 8.42 Years $ 301,500 Options Granted 945,000 $ 2.02 Options Exercised - - Options Forfeited - - Options Expired (436,668 ) 2.36 Options Outstanding as of September 30, 2018 2,552,731 $ 2.83 9.16 Years $ 258,666 Options Exercisable as of September 30, 2018 819,409 $ 2.66 8.51 Years $ 189,861 The aggregate intrinsic value is calculated as the difference between the Company’s closing stock price of $2.08 on September 30, 2018, and the exercise price of options, multiplied by the number of options. As of September 30, 2018, there was $4,525,434 total unrecognized stock-based compensation. Such costs are expected to be recognized over a weighted-average period of approximately 1.73 years. The Company recognizes compensation expense for stock option awards on a straight-line basis over the applicable service period of the award. The service period is generally the vesting period. The following assumptions were used to calculate stock-based compensation for issuances during the nine months ended September 30, 2018. September 2018 Expected Term (years) 6 - 6.5 Years Volatility 124.4-128.0% Risk-Free Interest Rate 2.5-2.9% Dividend Yield 0 % The Company does not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. Hence, the Company uses the “simplified method” described in Staff Accounting Bulletin 107 to estimate the expected term of share option grants. The expected stock price volatility assumption was determined by examining the historical volatilities for the Company’s common stock. The Company will continue to analyze the historical stock price volatility and expected term assumptions as more historical data for the Company’s common stock becomes available. The risk-free interest rate assumption is based on the U.S. treasury instruments whose term was consistent with the expected term of the Company’s stock options. The expected dividend assumption is based on the Company’s history and expectation of dividend payouts. The Company has never paid dividends on its common stock and does not anticipate paying dividends on its common stock in the foreseeable future. Accordingly, the Company has assumed no dividend yield for purposes of estimating the fair value of the Company stock-based compensation. The Company estimates the forfeiture rate at the time of grant and revisions, if necessary, were estimated based on management’s expectation through industry knowledge and historical data. Stock-Based Compensation Expense The following table sets forth the total stock-based compensation expense resulting from stock options and restricted grants of common stock to employees, directors and non-employee consultants in the consolidated statement of operations which are included in selling, general and administrative expenses: For the Three Months Ended September 30, 2018 September 30, 2017 Type of Award Number of Shares or Options Granted Stock-Based Compensation Expense Number of Shares or Options Granted Stock-Based Compensation Expense Stock Options 945,000 $ 690,686 132,051 $ 234,580 Stock Grants: Employees (Common Stock) 14,744 36,959 49,815 170,148 Employees (Series A Preferred Stock) 4 8 - - Employees (Series B Preferred Stock) - - - - Directors (Common Stock) 49,500 99,991 - - Non–Employee Consultants (Common Stock) 5,700 9,858 135,172 445,068 Total Stock–Based Compensation Expense $ 837,502 $ 849,796 For the Nine Months Ended September 30, 2018 September 30, 2017 Type of Award Number of Shares or Options Granted Stock-Based Compensation Expense Number of Shares or Options Granted Stock-Based Compensation Expense Stock Options 1,811,667 $ 1,645,384 682,051 $ 439,599 Stock Grants: Employees (Common Stock) 188,138 589,951 158,867 490,880 Employees (Series A Preferred Stock) 4 8 - - Employees (Series B Preferred Stock) - - 40,000 1,035,406 Directors (Common Stock) 49,500 99,991 81,061 221,973 Non–Employee Consultants (Common Stock) 49,982 133,587 325,772 1,036,427 Total Stock–Based Compensation Expense $ 2,468,921 $ 3,224,285

WARRANTS

WARRANTS	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 15 - WARRANTS	The Company has the following shares of common stock reserved for exercise of the warrants outstanding as of September 30, 2018: Shares Weighted-Average Exercise Price Warrants Outstanding as of January 1, 2018 1,191,367 $ 2.85 Warrants Exercised (283,697 ) $ 2.17 Warrants Granted 114,636 $ 4.05 Warrants Expired - $ - Warrants Outstanding as of March 31, 2018 1,022,306 $ 3.80 Warrants Exercised (27,800 ) $ 0.90 Warrants Granted 51,026 $ 2.94 Warrants Expired (26,710 ) $ 3.09 Warrants Outstanding as of June 30, 2018 1,018,822 $ 3.25 Warrants Exercised (27,778 ) $ 0.90 Warrants Granted 149,789 $ 1.98 Warrants Expired - $ - Warrants Outstanding as of September 30, 2018 1,140,833 $ 3.14 The following weighted-average assumptions were used to calculate the fair value of warrants issued during the period ended September 30, 2018 and 2017 using the Black-Scholes option pricing model: September 30, September 30, 2018 2017 Stock Price on Date of Grant $ 2.70 $ 4.42 Exercise Price $ 2.89 $ 5.07 Volatility 116.50 % 130.03 Term 5.00 Yrs 5.00 Risk-Free Interest Rate 2.70 % 1.63 Expected Dividend Rate 0 % 0 There were no warrants recognized as an expense for the three and nine months period ended September 30, 2018 and 2017, respectively.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 16 - COMMITMENTS AND CONTINGENCIES	California Operating Licenses Effective January 1, 2018 the State of California allowed for adult use cannabis sales. California’s cannabis licensing system is being implemented in two phases. First, beginning on January 1, 2018, the State began issuing temporary licenses. Temporary licenses were initially issued for 90 days but have since been extended twice by the state. Our current temporary licenses have been extended through December 2018, as the state has not issued any annual licenses to date and other similar operators are receiving extensions until the state begins to issue annual licenses. The extensions were initially provided because in May 2018, the Company had submitted all the necessary documentation for an annual license to be issued. Prior to the state completing its review of any annual licenses, the licensing authority BCC determined that they would eliminate the need to have multiple licenses issued to each entity for both medical and adult use. This meant the State would allow for an entity to apply for a consolidated license which allowed the entities to sell both medical and recreational cannabis. The Company has since applied for single category licenses that allow our vertically integrated activities to conduct sales in both the medical and adult use categories. The decision by the regulating authority meant that the cost of the annual licenses would also be reduced as prior to this change we would have had to apply for two licenses one in each category and they each bore a multi-thousand dollar expense. The Company’s prior licenses obtained from the local jurisdictions in which it operated in have been continued by such jurisdictions and are necessary to obtain state licensing. The Company has received a temporary license for each local jurisdiction which it had active operations. The temporary permits may be extended for an additional period of time. The Company submitted its applications for the annual permits in April 2018. Although the Company believes it will receive the necessary licenses from the State to conduct its business in a timely fashion, there is no guarantee the Company will be able to do so and any failure to do so may have a negative effect on its business and results of operations. Although the possession, cultivation and distribution of cannabis for medical and adult use is permitted in California and Nevada, cannabis is a Schedule-I controlled substance and its use remains a violation of federal law. Since federal law criminalizing the use of cannabis preempts state laws that legalize its use, strict enforcement of federal law regarding cannabis would likely result in our inability to proceed with our business plan, especially in respect of our cannabis cultivation, production and dispensaries. In addition, our assets, including real property, cash, equipment and other goods, could be subject to asset forfeiture because cannabis remains federally illegal.

SEGMENT INFORMATION

SEGMENT INFORMATION	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 17 - SEGMENT INFORMATION	The Company’s operating and reportable segments are currently organized around the following products that it offers as part of its core business strategy: · Herbs and Produce Products · Cannabis Dispensary, Cultivation and Production Summarized financial information concerning the Company’s reportable segments is shown in the following tables. Total asset amounts at September 30, 2018 and 2017 exclude intercompany receivable balances eliminated in consolidation. For the Three Months Ended September 30, 2018 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 1,183,471 $ 5,842,131 $ 57,623 $ 7,083,225 Cost of Goods Sold 782,686 4,776,834 - 5,559,520 Gross Profit 400,785 1,065,297 57,623 1,523,705 Selling, General and Administrative Expenses 1,156,272 2,829,382 5,419,291 9,404,945 Loss from Operations (755,487 ) (1,764,085 ) (5,361,668 ) (7,881,240 ) Other Income (Expense): Amortization of Debt Discount - - (498,961 ) (498,961 ) Loss on Extinguishment of Debt - - (4,257,029 ) (4,257,029 ) Loss on Fair Market Valuation of Derivatives - - (103,600 ) (103,600 ) Share of Loss in Joint Venture - (439,354 ) - (439,354 ) Interest Income (Expense) - - (425,160 ) (425,160 ) Total Other Income (Expense) - (439,354 ) (5,284,750 ) (5,724,104 ) Net Loss $ (755,487 ) $ (2,203,439 ) $ (10,646,418 ) $ (13,605,344 ) Total Assets at September 30, 2018 $ 6,152,630 $ 71,160,430 $ 37,331,597 $ 114,644,657 For the Three Months Ended September 30, 2017 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 1,432,500 $ 8,673,560 $ 15,315 $ 10,121,375 Cost of Goods Sold 1,192,251 6,594,186 - 7,786,437 Gross Profit 240,249 2,079,374 15,315 2,334,938 Selling, General and Administrative Expenses 874,141 2,822,488 2,541,481 6,238,110 . Loss from Operations (633,892 ) (743,114 ) (2,526,166 ) (3,903,172 ) Other Income (Expense): Amortization of Debt Discount - - (490,068 ) (490,068 ) Loss on Extinguishment of Debt - - (1,373,538 ) (1,373,538 ) Impairment of Property - - (138,037 ) (138,037 ) Loss on Fair Market Valuation of Derivatives - - (1,475,900 ) (1,475,900 ) Interest Income (Expense) - 51 (119,701 ) (119,650 ) Total Other Income (Expense) - 51 (3,597,244 ) (3,597,193 ) Net Loss $ (633,892 ) $ (743,063 ) $ (6,123,410 ) $ (7,500,365 ) Total Assets at September 30, 2017 $ 6,914,892 $ 68,290,922 $ 12,151,701 $ 87,357,515 For the Nine Months Ended September 30, 2018 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 3,970,161 $ 20,360,656 $ 85,951 $ 24,416,768 Cost of Goods Sold 3,004,497 16,032,703 - 19,037,200 Gross Profit 965,664 4,327,953 85,951 5,379,568 Selling, General and Administrative Expenses 3,093,545 9,656,613 13,079,705 25,829,863 Loss from Operations (2,127,881 ) (5,328,660 ) (12,993,754 ) (20,450,295 ) Other Income (Expense): Amortization of Debt Discount - - (1,384,641 ) (1,384,641 ) Loss on Extinguishment of Debt - - (12,115,752 ) (12,115,752 ) Gain on Fair Market Valuation of Derivatives - - 524,400 524,400 Share of Loss in Joint Venture - (439,354 ) - (439,354 ) Interest Expense - (396 ) (1,015,764 ) (1,016,160 ) Total Other Income (Expense) - (439,750 ) (13,991,757 ) (14,431,507 ) Net Loss $ (2,127,881 ) $ (5,768,410 ) $ (26,985,511 ) $ (34,881,802 ) Total Assets at September 30, 2018 $ 6,152,630 $ 71,160,430 $ 37,331,597 $ 114,644,657 For the Nine Months Ended September 30, 2017 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 4,126,710 $ 20,609,917 $ 52,077 $ 24,788,704 Cost of Goods Sold 3,487,795 17,100,535 - 20,588,330 Gross Profit 638,915 3,509,382 52,077 4,200,374 Selling, General and Administrative Expenses 2,389,203 7,659,968 8,604,526 18,653,697 . Loss from Operations (1,750,288 ) (4,150,586 ) (8,552,449 ) (14,453,323 ) Other Income (Expense): Amortization of Debt Discount - - (1,616,338 ) (1,616,338 ) Loss on Extinguishment of Debt - - (4,052,133 ) (4,052,133 ) Impairment of Property - - (138,037 ) (138,037 ) Gain on Fair Market Valuation of Derivatives - - 1,122,050 1,122,050 Interest Income (Expense) - 51 (408,044 ) (407,993 ) Loss on Fair Market Valuation of Contingent Consideration - (4,426,047 ) - (4,426,047 ) Gain on Settlement of Contingent Consideration - 4,991,571 - 4,991,571 Total Other Income (Expense) - 565,575 (5,092,502 ) (4,526,927 ) Net Loss $ (1,750,288 ) $ (3,585,011 ) $ (13,644,951 ) $ (18,980,250 ) Total Assets at September 30, 2017 $ 6,914,892 $ 68,290,922 $ 12,151,701 $ 87,357,515

LITIGATION AND CLAIMS

LITIGATION AND CLAIMS	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 18 - LITIGATION AND CLAIMS	The Company is the subject of lawsuits and claims arising in the ordinary course of business from time to time. The Company reviews any such legal proceedings and claims on an ongoing basis and follows appropriate accounting guidance when making accrual and disclosure decisions. The Company establishes accruals for those contingencies where the incurrence of a loss is probable and can be reasonably estimated, and it discloses the amount accrued and the amount of a reasonably possible loss in excess of the amount accrued if such disclosure is necessary for the Company’s financial statements to not be misleading. To estimate whether a loss contingency should be accrued by a charge to income, the Company evaluates, among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of the loss. The Company does not record liabilities when the likelihood that the liability has been incurred is probable, but the amount cannot be reasonably estimated. Based upon present information, the Company determined that there were no matters that required an accrual as of September 30, 2018 nor were there any asserted or unasserted material claims for which material losses are reasonably possible. On April 11, 2018, the Company filed a lawsuit in the United States District Court, Central District of California against Kenneth Vande Vrede, Michael Vande Vrede, Steven Vande Vrede, Daniel Vande Vrede, Greda Vande Vrede, Beverly Willekes, Brian Vande Vrede, Gro-Rite, Inc. (“Gro-Rite”) and Naturally Beautiful Plant Products, LLC (“Naturally Beautiful”) alleging breach of contract, breach of fiduciary duties, conversion, fraud, breach of covenant of good faith and fair dealing, misappropriation of trade secrets, and conspiracy related to, among other things, the Share Exchange Agreement, dated as of April 24, 2013 among the Company, the Company’s wholly-owned subsidiary, Edible Garden Corp. (“Edible Garden”), and the individual defendants (the “Share Exchange Agreement”). The Company is seeking monetary damages, including attorneys’ fees and expenses, return of shares of the Company’s common stock issued to the individual defendants under the Share Exchange Agreement, return of stock options issued to the individual defendants, and return of the Company’s intellectual property. On April 10, 2018, Gro-Rite, Naturally Beautiful and Whitetown Realty (“Whitetown Realty” and collectively, the “Whitetown Realty Plaintiffs”) filed a lawsuit in the Superior Court of New Jersey Law Division, Morris County against the Company and Edible Garden alleging, among other things, that Edible Garden owes certain amounts to Gro-Rite under a Marketing and Distribution Agreement between Edible Garden and Gro-Rite, dated May 7, 2013, and Naturally Beautiful under a Marketing and Distribution Agreement between Edible Garden and Naturally Beautiful, dated May 13, 2013 (collectively, the “Marketing and Distribution Agreements”), and that Edible Garden owes certain amounts to Whitetown Realty under the Lease between Whitetown Realty and Edible Garden, dated January 1, 2015 (the “Lease”). The Whitetown Realty Plaintiffs are seeking, among other things, compensatory damages for the amounts claimed are owed and attorneys’ fees and costs. The Company believes that Edible Garden does not owe any payments under the Marketing and Distribution Agreements or the Lease. The Company disputes the Whitetown Realty Plaintiffs’ allegations in the lawsuit and intends to vigorously defend itself. Accordingly, on May 18, 2018, the Company and Edible Garden filed an answer denying the allegations of the Whitetown Realty plaintiffs. In that same pleading, Edible Garden filed a counterclaim against Naturally Beautiful and Gro-Rite asserting claims for breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, trademark infringement/unfair competition, and tortious interference with contractual relations. Edible Garden also filed a third-party complaint against previously unidentified defendants John Doe Entities 1-10 and John Doe Individuals 1-10 arising from the wrongful misappropriation and pirating of electricity from the Edible Garden facility located at 283 Route 519, Belvidere, New Jersey. That third-party complaint alleges claims for unjust enrichment, tortious interference with contractual relations and conversion. On June 8, 2018, Edible Garden filed an amended counterclaim adding a count for conversion against Naturally Beautiful and Gro-Rite. On June 12, 2018, Edible Garden Corp. filed an amended third-party complaint adding Gerda Vande Vrede as a named third-party defendant. On June 13, 2018, Gro-Rite and Naturally Beautiful filed an answer to Edible Garden’s amended counterclaim and Gerda Vande Vrede filed an answer to Edible Garden’s amended third-party complaint denying the allegations asserted against them. No counterclaims, crossclaims or fourth party complaints were filed on behalf of Gerda Vande Vrede, Naturally Beautiful or Gro-Rite. On April 13, 2018, Edible Garden Corp. filed a lawsuit in the Superior Court of New Jersey Chancery Division, Warren County against Whitetown Realty in response to a letter from a law firm representing Whitetown Realty alleging Edible Garden was in default of the Lease. Edible Garden is seeking declaratory and equitable relief to prevent Whitetown Realty from terminating the Lease and for attorneys’ fees and costs. The Company believes that Edible Garden has made all payments due to Whitetown Realty under the Lease and maintains Edible Garden is not in default of the Lease. On April 23, 2018, by order of the assignment judge of Warren County, the lawsuit was transferred to Morris County and consolidated with the April 10, 2018 lawsuit previously filed by Gro-Rite, Naturally Beautiful and Whitetown Realty in the Superior Court of New Jersey, Law Division, Morris County. On June 13, 2018, Whitetown Realty filed its answer to the Edible Garden Complaint. In that answer, Whitetown Realty denies that Edible Garden is entitled to the declaratory and equitable relief that Edible Garden requested. No counterclaim was filed by Whitetown Realty. On April 11, 2018, Kenneth Vande Vrede, Michael Vande Vrede and Steven Vande Vrede (collectively, the “Vande Vrede Brothers”) filed a lawsuit in the Superior Court of New Jersey Law Division, Warren County against the Company and Edible Garden alleging, among other things, that the Company and Edible Garden improperly suspended the Vande Vrede Brothers from their positions with the Company and Edible Garden. The Vande Vrede Brothers were seeking, among other things, a declaratory judgment that they did not violate their fiduciary duties owed to the Company or Edible Garden and reinstating the Vande Vrede Brothers to their status with the Company and Edible Garden prior to their suspensions and attorneys’ fees and costs. The original complaint in this matter was never served, and on June 12, 2018, the Vande Vrede Brothers, and now David Vande Vrede, Daniel Vande Vrede, Beverly Willekes, and Whitetown Realty filed an amended complaint against Terra Tech, Edible Garden, Derek Peterson, Michael James, and Michael Nahass. The Company filed a pre-answer motion to dismiss the amended complaint, arguing that any of the plaintiffs’ claims that relate to the Share Exchange Agreement, belong in the already existing lawsuit in California, and any of the plaintiffs’ claims that relate to the lease, belong in the already existing lawsuits in New Jersey. The Company disputes the Vande Vredes’ allegations in the lawsuit and intends to vigorously defend itself.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2018
Notes to Financial Statements
NOTE 19 - SUBSEQUENT EVENTS	Equity Financing Facility On October 23, 2018, the Company issued 262,956 shares of common stock for $500,000 cash in settlement of a put notice dated October 12, 2018 pursuant to the Investor Agreement dated November 28, 2016 with an accredited investor. On September 7, 2018, Company filed a shelf registration statement on Form S-3 with the United States Securities and Exchange Commission (“SEC”). The shelf registration was declared effective by the SEC, on October 11, 2018. The registration statement will allow the Company to issue, from time to time at prices and on terms to be determined at or prior to the time of the offering, shares of our common stock, par value $0.001 per share (our “Common Stock”), shares of our preferred stock, par value $0.001 per share (our “Preferred Stock”), debt securities, warrants, rights, or purchase contracts, either individually or in units, with a total value of up to $100,000,000. Debt and Interest Converted into Equity Subsequent to September 30, 2018, senior convertible promissory notes and accrued interest issued under the 2018 Master Securities Purchase Agreement, in the amount of $1,500,000 and $33,3334, respectively, were converted into 998,244 shares of common stock. Other On August 31, 2018, the Company entered into a Standard Purchase Agreement (the “Purchase Agreement”) with North Fourth LLC pursuant to which the Company agreed to purchase the real property located at 121 North Fourth Street, Las Vegas, NV 89101 (the “Property”) for a purchase price of $2,700,000. On October 2, 2018, the Company assigned all of its right, title and interest to the Purchase Agreement to its wholly-owned subsidiary, 121 North Fourth Street, LLC (“121 North Fourth Street”) pursuant to an Assignment (the “Assignment”). On October 5, 2018 (the “Closing Date”), the Company paid $1,100,000 in cash towards the purchase price and 121 North Fourth Street entered into a $1,600,000 promissory note for the remaining purchase price of the building with a third-party creditor. The promissory note is collateralized by the building purchased and the Company as the guarantor. The interest rate for the first year is 12.0% and increases 0.5% per year through 2021. Payments of interest only are due monthly. The full principle balance and accrued interest are due at maturity on November 1, 2021. On October 22, 2018, MediFarm LLC, a wholly-owned subsidiary of Terra Tech Corp. (the “Company”), completed the disposition (the “Disposition”), previously announced on July 12, 2018, of substantially all of the assets of the Company related to the Company’s dispensary located at 1921 Western Ave., Las Vegas, NV 89102 (the “Business”) to Exhale Brands Nevada III, LLC (the “Purchaser”) for aggregate consideration of $6,250,000 in cash plus the value of any inventory of the Business on the closing date. See “Note 4 - Assets Held for Sale” for additional disclosure.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2018
Summary Of Significant Accounting Policies
Basis of Presentation	The accompanying interim unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Securities Exchange Commission (“SEC”) Form 10-Q and Article 10 of Regulation S-X of the Securities Act of 1933 and reflect the accounts and operations of the Company and those entities in which we have a controlling financial interest. In accordance with the provisions of the Financial Accounting Standards Board (“FASB”) or Accounting Standards Codification (“ASC”) 810, “Consolidation” All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. These interim unaudited consolidated financial statements do not include all disclosures required by GAAP for complete financial statements and, therefore, should be read in conjunction with the more detailed audited consolidated financial statements for the year ended December 31, 2017. The December 31, 2017 balances reported herein are derived from the audited consolidated financial statements for the year ended December 31, 2017. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year.
Non-Controlling Interest	Non-controlling interest is shown as a component of stockholders’ equity on the consolidated balance sheets and the share of net income (loss) attributable to non-controlling interest is shown as a component of net income (loss) in the consolidated statements of operations.
Use of Estimates	The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the financial statements and the reported amounts of total net revenue and expenses in the reporting periods. The Company regularly evaluates estimates and assumptions related to revenue recognition, allowances for doubtful accounts, sales returns, inventory valuation, stock-based compensation expense, goodwill and purchased intangible asset valuations, derivative liabilities, deferred income tax asset valuation allowances, uncertain tax positions, tax contingencies, litigation and other loss contingencies. These estimates and assumptions are based on current facts, historical experience and various other factors that the Company believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. The actual results the Company experiences may differ materially and adversely from these estimates. To the extent there are material differences between the estimates and actual results, the Company’s future results of operations will be affected. The Company continues to evaluate the impact of adult use legalization in California on its sales forecasts. Certain of the Company’s assets, such as goodwill, may be negatively impacted if the Company were to decrease its California sales forecasts.
Investments	Investments in unconsolidated affiliates are accounted for under the cost or the equity method of accounting, as appropriate. The Company accounts for investments in limited partnerships or limited liability corporations, whereby the Company owns a minimum of 5% of the investee's outstanding voting stock, under the equity method of accounting. These investments are recorded at the amount of the Company's investment and adjusted each period for the Company's share of the investee's income or loss, and dividends paid. As investments accounted for under the cost method do not have readily determinable fair values, the Company only estimates fair value if there are identified events or changes in circumstances that could have a significant adverse effect on the investment's fair value.
Assets Held for Sale	Assets held for sale represent furniture, equipment, and leasehold improvements less accumulated depreciation as well as any other assets that are held for sale in conjunction with the sale of a business. The Company recorded assets held for sale in accordance with ASC 360 , “Property, Plant, and Equipment,”
Goodwill	Goodwill is measured as the excess of consideration transferred and the net of the acquisition date fair value of assets acquired, and liabilities assumed in a business acquisition. In accordance with ASC 350, “Intangibles—Goodwill and Other,” The Company reviews the goodwill allocated to each of our reporting units for possible impairment annually during the third quarter and whenever events or changes in circumstances indicate its carrying amount may not be recoverable. When assessing goodwill for impairment, the Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, the Company determines it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the Company performs a two-step impairment test. If the Company concludes otherwise, then no further action is taken. The Company also has the option to bypass the qualitative assessment and only perform a quantitative assessment, which is the first step of the two-step impairment test. In the two-step impairment test, the Company measures the recoverability of goodwill by comparing a reporting unit’s carrying amount, including goodwill, to the estimated fair value of the reporting unit. There were no events or changes in circumstances that indicated potential impairment of intangible assets during the third quarter 2018, as such the Company determined that no adjustment to the carrying value of goodwill was required.
Revenue Recognition and Performance Obligations	On January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers” Under the new standard, the Company recognizes a sale as follows: Cannabis Dispensary, Cultivation and Production The Company recognizes revenue from manufacturing and distribution product sales when our customers obtain control of our products. Revenue from our retail dispensaries is recorded at the time customers take possession of the product. Revenue from our retail dispensaries is recognized net of discounts, rebates, promotional adjustments, price adjustments and returns, and net of taxes collected from customers that are remitted to governmental authorities, with the collected taxes recorded as current liabilities until remitted to the relevant government authority. Upon purchase, the Company has no further performance obligations and collection is assured as sales are paid for at time of purchase. Revenue related to distribution customers is recorded when the customer is determined to have taken control of the product. This determination is based on the customer specific terms of the arrangement and gives consideration to factors including, but not limited to, whether the customer has an unconditional obligation to pay, whether a time period or event is specified in the arrangement and whether the Company can mandate the return or transfer of the products. Revenue is recorded net of taxes collected from customers that are remitted to governmental authorities with collected taxes recorded as current liabilities until remitted to the relevant government authority. Herbs and Produce Products The Company recognizes revenue from products grown in its greenhouses upon delivery of the product to the customer at which time control passes to the customer. Upon transfer of control, the Company has no further performance obligations. For sales for which the Company uses an outside grower, the Company evaluates whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions. The evaluation considers whether the Company takes control of the products of the outside grower, whether it has the ability to direct the outside grower to provide the product to the customer on its behalf or whether it combines products from the outside grower with its own goods and services to provide the products to the customer. In evaluating whether it takes control of the products of the outside grower, the Company considers whether it has primary responsibility for fulfilling the promise to provide the products, whether the Company is subject to inventory risk related to the products and whether it has the ability to set the selling prices for the products. Disaggregation of Revenue See “Note 17 – Segment Information” Contract Balances Due to the nature of the Company’s revenue from contracts with customers, the Company does not have material contract assets or liabilities that fall under the scope of ASC Topic 606. Contract Estimates and Judgments The Company’s revenues accounted for under ASC Topic 606, generally, do not require significant estimates or judgments based on the nature of the Company’s revenue streams. The sales prices are generally fixed at the point of sale and all consideration from contracts is included in the transaction price. The Company’s contracts do not include multiple performance obligations or material variable consideration.
Fair Value of Financial Instruments	The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has not elected the fair value option to measure any eligible financial instruments.
Derivative Financial Instruments	ASC 815-40, “Derivatives and Hedging” ASC 815, “Derivatives and Hedging” The Company estimates the fair value of any new derivative liabilities using the Monte Carlo Simulation (“MCS”) technique because it provides for the necessary assumptions and inputs. The MCS technique, which is an option-based model, is a generally accepted valuation technique for valuing embedded conversion features in convertible notes because it is an open-ended valuation model that embodies all significant assumption types and ranges of assumption inputs that the Company agrees would likely be considered in connection with the arms-length negotiation related to the transference of the instrument by market participants. In addition to the typical assumptions in a closed-end option model, such as volatility and a risk-free rate, MCS incorporates assumptions for interest risk, credit risk and redemption behavior. In addition, MCS breaks down the time to expiration into, potentially, a large population of time intervals and steps. However, there may be other circumstances or considerations, other than those addressed herein, that relate to both internal and external factors that would be considered by market participants as it relates specifically to the Company and the subject financial instruments. The effects, if any, of these considerations cannot be reasonably measured, quantified or qualified.
Recently Adopted Accounting Standards	FASB ASU No. 2014-09 (Topic 606), “Revenue from Contracts with Customers” “Revenue from Contracts with Customers “Revenue from Contracts with Customers” FASB ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)” “Statement of Cash Flows.” FASB ASU 2017-09, “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting” - Recently Issued Accounting Standards FASB ASU No. 2018-13 (Topic 820), “Fair Value Measurement” – Conceptual Framework for Financial Reporting—Chapter 8: Notes to Financial Statements FASB ASU No. 2018-07 (Topic 718), “Compensation—Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting” – FASB ASU 2017-01 (Topic 805), “Business Combinations: Clarifying the Definition of a Business” Business Combinations (Topic 805), Clarifying the Definition of a Business Revenue from Contracts with Customers FASB ASU 2017-11,”Earnings Per Share, Distinguishing Liabilities from Equity, Derivatives and Hedging – (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception” – FASB ASU 2017-04 (Topic 350), “Intangibles - Goodwill and Others” FASB ASU No. 2016-02 (Topic 842), “Leases” – Leases Leases: Targeted Improvements

ASSETS HELD FOR SALE (Tables)

ASSETS HELD FOR SALE (Tables)	9 Months Ended
	Sep. 30, 2018
Assets Held For Sale
Schedule of assets held for sale	September 30, 2018 Cash $ 34,262 Inventory 173,637 Prepaid Expenses and Other Assets 35,905 Property, Equipment and Leasehold Improvements, Net 612,429 Assets Held for Sale $ 856,233

VARIABLE INTEREST ENTITY ARRA_2

VARIABLE INTEREST ENTITY ARRANGEMENTS (Tables)	9 Months Ended
	Sep. 30, 2018
Variable Interest Entity Arrangements
VARIABLE INTEREST ENTITY ARRANGEMENTS	September 30, December 31, 2018 2017 Current Assets: Cash $ 172,130 $ 409,029 Inventory 650,283 232,231 Prepaid Expenses and Other Current Assets 40,067 302,186 Total Current Assets 862,480 943,446 Property, Equipment and Leasehold Improvements, Net 1,849,782 1,965,103 TOTAL ASSETS $ 2,712,262 $ 2,908,549 Current Liabilities: Accounts Payable and Accrued Expenses $ 424,006 $ 319,853 TOTAL LIABILITIES $ 424,006 $ 319,853

ACQUISITIONS (Tables)

ACQUISITIONS (Tables)	9 Months Ended
	Sep. 30, 2018
Acquisitions
Acquisition with a purchase price	Assets Acquired Inventory $ 113,779 Property, Equipment and Leasehold Improvements 99,566 Security Deposits 5,000 Management Service Agreement 370,332 Goodwill 6,258,260 Total Assets Acquired $ 6,846,937

INVENTORY (Tables)

INVENTORY (Tables)	9 Months Ended
	Sep. 30, 2018
Inventory Tables Abstract
Inventory	September 30, December 31, 2018 2017 Raw Materials $ 1,210,885 $ 1,450,273 Work-in-Progress 794,216 1,016,596 Finished Goods 1,593,965 3,293,150 Total Inventory $ 3,599,066 $ 5,760,019

PROPERTY, EQUIPMENT AND LEASE_2

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET (Tables)	9 Months Ended
	Sep. 30, 2018
Property Equipment And Leasehold Improvements Net
Property, equipment, and leasehold improvements	September 30, December 31, 2018 2017 Land and Building $ 19,662,334 $ 9,047,201 Furniture and Equipment 3,522,960 3,553,587 Computer Hardware and Software 657,088 486,176 Leasehold Improvements 8,435,062 9,316,665 Construction in Progress 9,922,155 1,204,547 Subtotal 42,199,599 23,608,176 Less Accumulated Depreciation (5,310,751 ) (4,416,560 ) Property, Equipment and Leasehold Improvements, Net $ 36,888,848 $ 19,191,616

NOTES PAYABLE (Tables)

NOTES PAYABLE (Tables)	9 Months Ended
	Sep. 30, 2018
Notes Payable
Notes payable	September 30, December 31, 2018 2017 Senior convertible promissory note dated August 21, 2017, issued to accredited investors, which matures February 21, 2019 and bears interest at a rate of 12% per annum. The conversion price is $4.50, subject to adjustment. The balance of the note and accrued interest was converted into common stock in January 2018. $ - $ 640,010 Senior convertible promissory note dated December 26, 2017, issued to accredited investors, which matures June 26, 2019 and bears interest at a rate of 12% per annum. The conversion price is $4.50, subject to adjustment. The balance of the note and accrued interest was converted into common stock in January 2018. - 1,469,388 Promissory note dated November 22, 2017, issued for the purchase of real property. Matures December 1, 2020, with an option to extend the maturity date 1 year. The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.5%. In the event of default, the note is convertible at the holder's option. 4,500,000 4,500,000 Promissory note dated January 18, 2018, issued for the purchase of real property. The promissory note is collateralized by the land and building purchased and matures February 1, 2021, with an option to extend the maturity date 1 year. The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.0%. The full principle balance and accrued interest are due at maturity. In the event of default, the note is convertible at the holder's option. 6,218,286 - Senior convertible promissory note dated July 25, 2018, issued to accredited investors under the 2018 Master Securities Purchase and Convertible Promissory Notes Agreement, which matures January 25, 2020 and bears interest at a rate of 7.5% per annum. The conversion price is $4.50, subject to adjustment. 2,394,774 - Securities Purchase Agreement dated July 25, 2018, issued to accredited investors, which matures July 25, 2019 and bears interest at a rate of 3.0% per annum. The conversion price is 5.0% discount to the average of the three (3) lowest VWAPs in the five (5) trading days prior to the conversion date. 134,398 - Senior convertible promissory note dated September 6, 2018, issued to accredited investors under the 2018 Master Securities Purchase and Convertible Promissory Notes Agreement, which matures March 7, 2020 and bears interest at a rate of 7.5% per annum. The conversion price is $4.50, subject to adjustment. 580,887 - Long-Term Debt, Net of Discounts $ 13,828,345 $ 6,609,398
Conversion of the notes payable	Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Fair market value of common stock issued upon conversion $ 13,041,469 $ 6,424,597 $ 42,968,230 $ 18,156,952 Principal amount of debt converted (8,900,000 ) (3,250,000 ) (26,800,000 ) (11,814,324 ) Accrued interest converted (118,041 ) (232,225 ) (311,320 ) (506,985 ) Fair value of derivative at conversion date (3,699,000 ) (3,434,900 ) (19,271,000 ) (9,106,950 ) Debt discount value at conversion date 3,932,601 1,866,066 15,529,842 7,323,440 Loss on extinguishment of debt $ 4,257,029 $ 1,373,538 $ 12,115,752 $ 4,052,133 Common Stock Issued Upon Conversion (1) 6,111,043 1,668,902 13,414,287 5,769,600 (1) "Note 1 – Description of Business.”

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	9 Months Ended
	Sep. 30, 2018
Fair value hierarchy financial assets measured	Fair Value at September 30, Fair Value Measurement Using Description 2018 Level 1 Level 2 Level 3 Derivative Liabilities – Conversion Feature $ 2,222,000 $ - $ - $ 2,222,000 $ 2,222,000 $ - $ - $ 2,222,000 Fair Value at December 31, Fair Value Measurement Using Description 2017 Level 1 Level 2 Level 3 Derivative Liabilities – Conversion Feature $ 9,331,400 $ - $ - $ 9,331,400 $ 9,331,400 $ - $ - $ 9,331,400
Reconciliation of the Derivative Liabilities measured	For the Nine Months Ended September 30, 2018 2017 Balance at December 31, 2017 $ 9,331,400 $ 6,987,000 Change in Fair Market Value of Conversion Feature (524,400 ) (1,122,050 ) Derivative Debt Converted into Equity (19,271,000 ) (9,106,950 ) Fair Value of Derivative Liability Recorded Upon Issuance of Convertible Debt 12,686,000 7,881,000 Balance at September 30, 2018 $ 2,222,000 $ 4,639,000 For the Three Months Ended September 30, 2018 2017 Balance at June 30, 2018 $ 1,891,400 $ 3,163,000 Change in Fair Market Value of Conversion Feature 103,600 1,475,900 Derivative Debt Converted into Equity (3,699,000 ) (3,434,900 ) Fair Value of Derivative Liability Recorded Upon Issuance of Convertible Debt 3,926,000 3,435,000 Balance at September 30, 2018 $ 2,222,000 $ 4,639,000
Estimated fair value of derivative liabilities assumptions	Stock Price $2.08 - $6.90 Conversion and Exercise Price $1.98 - $6.60 Annual Dividend Yield 0% Expected Life (Years) 0.41 - 2.42 Risk-Free Interest Rate 1.77% - 2.81% Expected Volatility 62.36% - 103.43%
Monte Carlo [Member]
Estimated fair value of derivative liabilities assumptions	September 2018 Stock Price $1.76 - $2.88 Conversion and Exercise Price $1.41 - $2.29 Annual Dividend Yield 0% Expected Life (Years) 0.82 - 1.50 Risk-Free Interest Rate 2.32% - 2.70% Expected Volatility 94.00% - 104.30%

TAX EXPENSE (Tables)

TAX EXPENSE (Tables)	9 Months Ended
	Sep. 30, 2018
Tax Expense
Deferred tax assets and liabilities	September 30, December 31, 2018 2017 Deferred Income Tax Assets: Net Operating Losses $ 12,471,322 $ 8,023,000 12,471,322 8,023,000 Deferred Income Tax Liabilities: Depreciation (933,048 ) (850,000 ) Total 11,538,274 7,173,000 Valuation Allowance (11,538,274 ) (7,173,000 ) Net Deferred Tax $ - $ -

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	9 Months Ended
	Sep. 30, 2018
Stock-based Compensation
Equity Incentive Plan	Awards Reserved for Issuance Awards Issued Awards Available for Grant 2016 Equity Incentive Plan 30,000,000 2,552,731 27,447,269
Stock option activity	Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Life Aggregate Intrinsic Value of In-the-Money Options Options Outstanding as of Janury 1, 2018 1,177,732 $ 2.17 Options Granted 800,000 $ 4.41 Options Exercised - - Options Forfeited - - Options Expired - - Options Outstanding as of March 31, 2018 1,977,732 $ 3.08 9.1 Years $ 522,600 Options Exercisable as of Mach 31, 2018 659,774 $ 2.20 8.5 Years $ 391,950 Options Granted 66,667 $ 3.75 Options Exercised - - Options Forfeited - - Options Expired - - Options Outstanding as of June 30, 2018 2,044,399 $ 3.10 8.89 Years $ 361,800 Options Exercisable as of June 30, 2018 828,941 $ 2.38 8.42 Years $ 301,500 Options Granted 945,000 $ 2.02 Options Exercised - - Options Forfeited - - Options Expired (436,668 ) 2.36 Options Outstanding as of September 30, 2018 2,552,731 $ 2.83 9.16 Years $ 258,666 Options Exercisable as of September 30, 2018 819,409 $ 2.66 8.51 Years $ 189,861
Weighted-average assumptions stock-based compensation	September 2018 Expected Term (years) 6 - 6.5 Years Volatility 124.4-128.0% Risk-Free Interest Rate 2.5-2.9% Dividend Yield 0 %
Stock-Based Compensation Expense	For the Three Months Ended September 30, 2018 September 30, 2017 Type of Award Number of Shares or Options Granted Stock-Based Compensation Expense Number of Shares or Options Granted Stock-Based Compensation Expense Stock Options 945,000 $ 690,686 132,051 $ 234,580 Stock Grants: Employees (Common Stock) 14,744 36,959 49,815 170,148 Employees (Series A Preferred Stock) 4 8 - - Employees (Series B Preferred Stock) - - - - Directors (Common Stock) 49,500 99,991 - - Non–Employee Consultants (Common Stock) 5,700 9,858 135,172 445,068 Total Stock–Based Compensation Expense $ 837,502 $ 849,796 For the Nine Months Ended September 30, 2018 September 30, 2017 Type of Award Number of Shares or Options Granted Stock-Based Compensation Expense Number of Shares or Options Granted Stock-Based Compensation Expense Stock Options 1,811,667 $ 1,645,384 682,051 $ 439,599 Stock Grants: Employees (Common Stock) 188,138 589,951 158,867 490,880 Employees (Series A Preferred Stock) 4 8 - - Employees (Series B Preferred Stock) - - 40,000 1,035,406 Directors (Common Stock) 49,500 99,991 81,061 221,973 Non–Employee Consultants (Common Stock) 49,982 133,587 325,772 1,036,427 Total Stock–Based Compensation Expense $ 2,468,921 $ 3,224,285

WARRANTS (Tables)

WARRANTS (Tables)	9 Months Ended
	Sep. 30, 2018
Warrants
Warrants outstanding	Shares Weighted-Average Exercise Price Warrants Outstanding as of January 1, 2018 1,191,367 $ 2.85 Warrants Exercised (283,697 ) $ 2.17 Warrants Granted 114,636 $ 4.05 Warrants Expired - $ - Warrants Outstanding as of March 31, 2018 1,022,306 $ 3.80 Warrants Exercised (27,800 ) $ 0.90 Warrants Granted 51,026 $ 2.94 Warrants Expired (26,710 ) $ 3.09 Warrants Outstanding as of June 30, 2018 1,018,822 $ 3.25 Warrants Exercised (27,778 ) $ 0.90 Warrants Granted 149,789 $ 1.98 Warrants Expired - $ - Warrants Outstanding as of September 30, 2018 1,140,833 $ 3.14
Warrants utilizing weighted-average inputs	September 30, September 30, 2018 2017 Stock Price on Date of Grant $ 2.70 $ 4.42 Exercise Price $ 2.89 $ 5.07 Volatility 116.50 % 130.03 Term 5.00 Yrs 5.00 Risk-Free Interest Rate 2.70 % 1.63 Expected Dividend Rate 0 % 0

SEGMENT INFORMATION (Tables)

SEGMENT INFORMATION (Tables)	9 Months Ended
	Sep. 30, 2018
Segment Information
Summarized financial information	For the Three Months Ended September 30, 2018 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 1,183,471 $ 5,842,131 $ 57,623 $ 7,083,225 Cost of Goods Sold 782,686 4,776,834 - 5,559,520 Gross Profit 400,785 1,065,297 57,623 1,523,705 Selling, General and Administrative Expenses 1,156,272 2,829,382 5,419,291 9,404,945 Loss from Operations (755,487 ) (1,764,085 ) (5,361,668 ) (7,881,240 ) Other Income (Expense): Amortization of Debt Discount - - (498,961 ) (498,961 ) Loss on Extinguishment of Debt - - (4,257,029 ) (4,257,029 ) Loss on Fair Market Valuation of Derivatives - - (103,600 ) (103,600 ) Share of Loss in Joint Venture - (439,354 ) - (439,354 ) Interest Income (Expense) - - (425,160 ) (425,160 ) Total Other Income (Expense) - (439,354 ) (5,284,750 ) (5,724,104 ) Net Loss $ (755,487 ) $ (2,203,439 ) $ (10,646,418 ) $ (13,605,344 ) Total Assets at September 30, 2018 $ 6,152,630 $ 71,160,430 $ 37,331,597 $ 114,644,657 For the Three Months Ended September 30, 2017 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 1,432,500 $ 8,673,560 $ 15,315 $ 10,121,375 Cost of Goods Sold 1,192,251 6,594,186 - 7,786,437 Gross Profit 240,249 2,079,374 15,315 2,334,938 Selling, General and Administrative Expenses 874,141 2,822,488 2,541,481 6,238,110 . Loss from Operations (633,892 ) (743,114 ) (2,526,166 ) (3,903,172 ) Other Income (Expense): Amortization of Debt Discount - - (490,068 ) (490,068 ) Loss on Extinguishment of Debt - - (1,373,538 ) (1,373,538 ) Impairment of Property - - (138,037 ) (138,037 ) Loss on Fair Market Valuation of Derivatives - - (1,475,900 ) (1,475,900 ) Interest Income (Expense) - 51 (119,701 ) (119,650 ) Total Other Income (Expense) - 51 (3,597,244 ) (3,597,193 ) Net Loss $ (633,892 ) $ (743,063 ) $ (6,123,410 ) $ (7,500,365 ) Total Assets at September 30, 2017 $ 6,914,892 $ 68,290,922 $ 12,151,701 $ 87,357,515 For the Nine Months Ended September 30, 2018 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 3,970,161 $ 20,360,656 $ 85,951 $ 24,416,768 Cost of Goods Sold 3,004,497 16,032,703 - 19,037,200 Gross Profit 965,664 4,327,953 85,951 5,379,568 Selling, General and Administrative Expenses 3,093,545 9,656,613 13,079,705 25,829,863 Loss from Operations (2,127,881 ) (5,328,660 ) (12,993,754 ) (20,450,295 ) Other Income (Expense): Amortization of Debt Discount - - (1,384,641 ) (1,384,641 ) Loss on Extinguishment of Debt - - (12,115,752 ) (12,115,752 ) Gain on Fair Market Valuation of Derivatives - - 524,400 524,400 Share of Loss in Joint Venture - (439,354 ) - (439,354 ) Interest Expense - (396 ) (1,015,764 ) (1,016,160 ) Total Other Income (Expense) - (439,750 ) (13,991,757 ) (14,431,507 ) Net Loss $ (2,127,881 ) $ (5,768,410 ) $ (26,985,511 ) $ (34,881,802 ) Total Assets at September 30, 2018 $ 6,152,630 $ 71,160,430 $ 37,331,597 $ 114,644,657 For the Nine Months Ended September 30, 2017 (Unaudited) Herbs and Produce Products Cannabis Dispensary, Cultivation and Production Eliminations and Other Total Total Revenues $ 4,126,710 $ 20,609,917 $ 52,077 $ 24,788,704 Cost of Goods Sold 3,487,795 17,100,535 - 20,588,330 Gross Profit 638,915 3,509,382 52,077 4,200,374 Selling, General and Administrative Expenses 2,389,203 7,659,968 8,604,526 18,653,697 . Loss from Operations (1,750,288 ) (4,150,586 ) (8,552,449 ) (14,453,323 ) Other Income (Expense): Amortization of Debt Discount - - (1,616,338 ) (1,616,338 ) Loss on Extinguishment of Debt - - (4,052,133 ) (4,052,133 ) Impairment of Property - - (138,037 ) (138,037 ) Gain on Fair Market Valuation of Derivatives - - 1,122,050 1,122,050 Interest Income (Expense) - 51 (408,044 ) (407,993 ) Loss on Fair Market Valuation of Contingent Consideration - (4,426,047 ) - (4,426,047 ) Gain on Settlement of Contingent Consideration - 4,991,571 - 4,991,571 Total Other Income (Expense) - 565,575 (5,092,502 ) (4,526,927 ) Net Loss $ (1,750,288 ) $ (3,585,011 ) $ (13,644,951 ) $ (18,980,250 ) Total Assets at September 30, 2017 $ 6,914,892 $ 68,290,922 $ 12,151,701 $ 87,357,515

DESCRIPTION OF BUSINESS (Detail

DESCRIPTION OF BUSINESS (Details Narrative)	Mar. 12, 2018	Sep. 30, 2018
Description Of Business
State of Incorporation		Nevada
Reverse stock split	1-for-15

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative)	Sep. 30, 2018
Summary Of Significant Accounting Policies Details Narrative Abstract
Ownership percentage	5.00%

ASSETS HELD FOR SALE (Details)

ASSETS HELD FOR SALE (Details)	Sep. 30, 2018USD ($)
Components Of Assets Held for Sale and Liabilities Held for Sale:
Cash	$ 34,262
Inventory	173,637
Prepaid Expenses and Other Assets	35,905
Property, Equipment and Leasehold Improvements, Net	612,429
Assets Held for Sale	$ 856,233

ASSETS HELD FOR SALE (Details N

ASSETS HELD FOR SALE (Details Narrative)	Jul. 06, 2018USD ($)
MediFarm LLC [Member] | Subsequent Event [Member]
Business consideration	$ 6,250,000

VARIABLE INTEREST ENTITY ARRA_3

VARIABLE INTEREST ENTITY ARRANGEMENTS (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Current Assets:
Cash	$ 3,418,991	$ 5,445,582
Inventory	3,599,066	5,760,019
Prepaid Expenses and Other Current Assets	781,373	1,067,689
Total Current Assets	9,545,786	18,243,131
Property, Equipment and Leasehold Improvements, Net	36,888,848	19,191,616
TOTAL ASSETS	114,644,657	98,187,799
Current Liabilities:
Accounts Payable and Accrued Expenses	5,492,742	5,444,710
Total Liabilities	21,543,087	21,385,508
Variable Interest Entity [Member]
Current Assets:
Cash	172,130	409,029
Inventory	650,283	232,231
Prepaid Expenses and Other Current Assets	40,067	302,186
Total Current Assets	862,480	943,446
Property, Equipment and Leasehold Improvements, Net	1,849,782	1,965,103
TOTAL ASSETS	2,712,262	2,908,549
Current Liabilities:
Accounts Payable and Accrued Expenses	424,006	319,853
Total Liabilities	$ 424,006	$ 319,853

INVESTMENTS IN UNCONSOLIDATED_2

INVESTMENTS IN UNCONSOLIDATED AFFILIATES (Details Narrative) - USD ($)	1 Months Ended	3 Months Ended				9 Months Ended
	Aug. 28, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Oct. 26, 2017
Ownership percentage		5.00%				5.00%
Loss		$ (13,669,803)			$ (7,792,933)	$ (35,129,726)	$ (18,358,690)
Initial exercise price		$ 2.02	$ 3.75	$ 4.41
Joint Venture Agreements [Member] | NuLeaf [Member]
Convertible loans								$ 4,500,000
Interest rate per annum								6.00%
Ownership percentage								50.00%
Other assets								$ 7,130,000
Loss		$ 440,000				440,000
Subscription Agreement [Member] | NuLeaf [Member]
Other assets		$ 5,000,000				$ 5,000,000
Common stock purchase description	<font style="font: 10pt Times New Roman, Times, Serif">Hydrofarm agreed to sell to the Company 2,000,000 Units, each Unit consisting of one share of common stock and one warrant to purchase one-half of a share of common stock for an initial exercise price of $5.00 per share, for $2.50 per Unit for an aggregate purchase price of $5,000,000</font></p>" id="sjs-B14">&lt;p style="margin: 0; text-align: justify">&lt;font style="font: 10pt Times New Roman, Times, Serif">Hydrofarm agreed to sell to the Company 2,000,000 Units, each Unit consisting of one share of common stock and one warrant to purchase one-half of a share of common stock for an initial exercise price of $5.00 per share, for $2.50 per Unit for an aggregate purchase price of $5,000,000&lt;/font>&lt;/p>
Initial exercise price	$ 5

ACQUISITIONS (Details)

ACQUISITIONS (Details)	Sep. 30, 2018USD ($)
Assets Acquired
Inventory	$ 113,779
Property, Equipment and Leasehold Improvements	99,566
Security Deposits	5,000
Management Service Agreement	370,332
Goodwill	6,258,260
Total Assets Acquired	$ 6,846,937

ACQUISITIONS (Details Narrative

ACQUISITIONS (Details Narrative)	9 Months Ended
	Sep. 30, 2018USD ($)
Acquisition Details Abstract
Fair value of management services, adjusted	$ 6,300,000
Decrease in amortization expense	$ 434,114

INVENTORY (Details)

INVENTORY (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Inventory Details Abstract
Raw Materials	$ 1,210,885	$ 1,450,273
Work-In-Progress	794,216	1,016,596
Finished Goods	1,593,965	3,293,150
Total Inventory	$ 3,599,066	$ 5,760,019

PROPERTY, EQUIPMENT AND LEASE_3

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Property, Equipment and Leasehold Improvements, Gross	$ 42,199,599	$ 23,608,176
Less Accumulated Depreciation	(5,310,751)	(4,416,560)
Property, Equipment and Leasehold Improvements, Net	36,888,848	19,191,616
Land and Building [Member]
Property, Equipment and Leasehold Improvements, Gross	19,662,334	9,047,201
Furniture and Equipment [Member]
Property, Equipment and Leasehold Improvements, Gross	3,522,960	3,553,587
Computer Hardware and Software [Member]
Property, Equipment and Leasehold Improvements, Gross	657,088	486,176
Leasehold Improvements [Member]
Property, Equipment and Leasehold Improvements, Gross	8,435,062	9,316,665
Construction in Progress [Member]
Property, Equipment and Leasehold Improvements, Gross	$ 9,922,155	$ 1,204,547

PROPERTY, EQUIPMENT AND LEASE_4

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Property Equipment And Leasehold Improvements Details Narrative Abstract
Depreciation expense	$ 417,132	$ 479,686	$ 1,487,869	$ 1,399,418

NOTES PAYABLE (Details)

NOTES PAYABLE (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Notes payable	$ 13,828,345	$ 6,609,398
Securities Purchase Agreement [Member]
Notes payable	134,398
Convertible Promissory Note [Member]
Notes payable		640,010
Convertible Promissory Note One [Member]
Notes payable		1,469,388
Promissory Note [Member]
Notes payable	4,500,000	4,500,000
Promissory Note One [Member]
Notes payable	6,218,286
Convertible Promissory Note Two [Member]
Notes payable	2,394,774
Convertible Promissory Note Three [Member]
Notes payable	$ 580,887

NOTES PAYABLE (Details 1)

NOTES PAYABLE (Details 1) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Note Payable Tables Abstract
Fair market value of common stock issued upon conversion		$ 13,041,469	$ 6,424,597	$ 42,968,230	$ 18,156,952
Principal amount of debt converted		(8,900,000)	(3,250,000)	(26,800,000)	(11,814,324)
Accrued interest converted		(118,041)	(232,225)	(311,320)	(506,985)
Fair value of derivative at conversion date		(3,699,000)	(3,434,900)	(19,271,000)	(9,106,950)
Debt discount value at conversion date		3,932,601	1,866,066	15,529,842	7,323,440
Loss on extinguishment of Debt		$ 4,257,029	$ 1,373,538	$ 12,115,752	$ 4,052,133
Common Stock Issued Upon Conversion	[1]	6,111,043	1,668,902	13,414,287	5,769,600
[1]	Adjusted to reflect the one for 15 reverse stock split. See "Note 1 "Description of Business."

NOTES PAYABLE (Details Narrativ

NOTES PAYABLE (Details Narrative) - USD ($)		Sep. 06, 2018	Jun. 07, 2018	Jul. 31, 2018	Jul. 25, 2018	Jun. 30, 2018	Apr. 30, 2018	Jan. 31, 2018	Jan. 18, 2018	Dec. 26, 2017	Nov. 22, 2017	Aug. 21, 2017	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Total Debt													$ 13,828,345			$ 13,828,345		$ 6,609,398
Unamortized debt discount													2,039,942			2,039,942		4,790,601
Accrued interest payable													10,212			10,212		21,767
Unamortized debt discount remaining balance													281,714			281,714
Cash paid for debt discount																(942,000)	$ (360,000)
Debt conversion converted amount													$ (8,900,000)		$ (3,250,000)	$ (26,800,000)	$ (11,814,324)
Debt conversion converted instrument, shares issued	[1]												6,111,043		1,668,902	13,414,287	5,769,600
Securities Purchase Agreement [Member]
Total Debt													$ 134,398			$ 134,398
Interest rate					3.00%
Description of conversion price					<font style="font: 10pt Times New Roman, Times, Serif">The conversion price is 5.0% discount to the average of the three (3) lowest VWAPs in the five (5 trading days prior to the conversion date</font></p>" id="sjs-F12">&lt;p style="margin: 0; text-align: justify">&lt;font style="font: 10pt Times New Roman, Times, Serif">The conversion price is 5.0% discount to the average of the three (3) lowest VWAPs in the five (5 trading days prior to the conversion date&lt;/font>&lt;/p>
Debt instrument maturity date					Jul. 25, 2019
Convertible promissory note [Member] | 2017 Master Securities Purchase Agreement [Member]
Unamortized debt discount																		$ 4,790,602
Interest rate								12.00%										12.00%
Unamortized debt discount remaining balance																		$ 6,900,000
Cash paid for debt discount								$ 150,000
Convertible debt aggregate value								5,000,000										20,000,000
Issuance of convertible debt								5,000,000										20,000,000
Debt conversion converted amount																		13,100,000
Issuance of warrants value								$ 196,000
Convertible promissory note [Member] | 2018 Master Securities Purchase Agreement [Member]
Interest rate				7.50%		7.50%							7.50%	7.50%		7.50%
Cash paid for debt discount				$ 150,000		$ 150,000								$ 150,000		$ 147,000
Convertible debt aggregate value														40,000,000
Amount per tranches														5,000,000
Issuance of convertible debt				5,000,000		5,000,000							$ 4,900,000			4,900,000
Debt conversion converted amount				$ 1,000,000		$ 5,000,000	$ 5,000,000									$ 3,900,000
Debt conversion converted instrument, shares issued				743,030		3,032,007	2,538,856									2,774,876
Issuance of warrants value				$ 120,000		$ 114,000								$ 116,000		$ 107,000
Description of conversion price														</p> <p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">For each note issued under the 2018 Master Securities Purchase Agreement, the principal and interest due and owed under the note is convertible into shares of Common Stock at any time at the election of the holder at a conversion price per share equal to the lower of (i) the original conversion price as defined in each note issuance or (ii) 87% of the average of the two lowest daily volume weighted average price of the Common Stock in the thirteen (13) trading days prior to the conversion date (“Conversion Price”). The Conversion Price is subject to adjustment for (i) stock splits, stock dividends, combinations, or similar events and (ii) full ratchet anti-dilution protection. Upon certain events of default, the conversion price will automatically become 70% of the average of the three (3) lowest volume weighted average prices of the Common Stock in the twenty (20) consecutive trading days prior to the conversion date for so long as such event of default remains in effect.</p> <p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">In addition, at any time that (i) the daily volume weighted average price of the Common Stock for the prior ten (10) consecutive trading days is $10.50 or more and (ii) the average daily trading value of the Common Stock is greater than $2,500,000 for the prior ten (10) consecutive trading days, then the Company may demand, upon one (1) day’s notice, that the holder convert the notes at the Conversion Price.</p> <p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">   </p> <p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company may prepay in cash any portion of the outstanding principal amount of the notes and any accrued and unpaid interest by, upon ten (10) days’ written notice to the holder, paying an amount equal to (i) 110% of the sum of the then-outstanding principal amount of the notes plus accrued but unpaid interest, if the prepayment date is within 90 days of the issuance date of the notes; (ii) 115% of the sum of the then-outstanding principal amount plus accrued but unpaid interest, if the prepayment date is between 91 days and 180 days of the issuance date of the notes; or (iii) 125% of the sum of the then-outstanding principal amount of the notes plus accrued but unpaid interest, if the prepayment date is after 180 days of the issuance date of the notes.</p> <p style="font: 11pt/107% Calibri, Helvetica, Sans-Serif; margin: 0 0 8pt; text-align: justify"> </p>" id="sjs-O32">&lt;p style="margin: 0pt">&lt;/p> &lt;p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">For each note issued under the 2018 Master Securities Purchase Agreement, the principal and interest due and owed under the note is convertible into shares of Common Stock at any time at the election of the holder at a conversion price per share equal to the lower of (i) the original conversion price as defined in each note issuance or (ii) 87% of the average of the two lowest daily volume weighted average price of the Common Stock in the thirteen (13) trading days prior to the conversion date (&#8220;Conversion Price&#8221;). The Conversion Price is subject to adjustment for (i) stock splits, stock dividends, combinations, or similar events and (ii) full ratchet anti-dilution protection. Upon certain events of default, the conversion price will automatically become 70% of the average of the three (3) lowest volume weighted average prices of the Common Stock in the twenty (20) consecutive trading days prior to the conversion date for so long as such event of default remains in effect.&lt;/p> &lt;p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;&lt;/p> &lt;p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">In addition, at any time that (i) the daily volume weighted average price of the Common Stock for the prior ten (10) consecutive trading days is $10.50 or more and (ii) the average daily trading value of the Common Stock is greater than $2,500,000 for the prior ten (10) consecutive trading days, then the Company may demand, upon one (1) day&#8217;s notice, that the holder convert the notes at the Conversion Price.&lt;/p> &lt;p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160; &#160;&lt;/p> &lt;p style="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company may prepay in cash any portion of the outstanding principal amount of the notes and any accrued and unpaid interest by, upon ten (10) days&#8217; written notice to the holder, paying an amount equal to (i) 110% of the sum of the then-outstanding principal amount of the notes plus accrued but unpaid interest, if the prepayment date is within 90 days of the issuance date of the notes; (ii) 115% of the sum of the then-outstanding principal amount plus accrued but unpaid interest, if the prepayment date is between 91 days and 180 days of the issuance date of the notes; or (iii) 125% of the sum of the then-outstanding principal amount of the notes plus accrued but unpaid interest, if the prepayment date is after 180 days of the issuance date of the notes.&lt;/p> &lt;p style="font: 11pt/107% Calibri, Helvetica, Sans-Serif; margin: 0 0 8pt; text-align: justify">&#160;&lt;/p>
PromissoryNoteMember
Interest rate escalation description											The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.5%</font></p>" id="sjs-L34">&lt;p>&lt;font style="font: 10pt Times New Roman, Times, Serif">The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.5%&lt;/font>&lt;/p>
Debt instrument maturity date											Dec. 1, 2020
PromissoryNoteMember | Minimum [Member]
Interest rate											12.00%
PromissoryNoteMember | Maximum [Member]
Interest rate											13.50%
PromissoryNoteMember | California [Member] | Third- Party Creditor [Member]
Purchase of land and building									$ 6,500,000
Cash paid for debt discount									195,000
Issuance of warrants value									$ 164,000
Interest rate escalation description									<font style="font: 10pt Times New Roman, Times, Serif">The interest rate for the first year is 12.0% and increases 0.5% per year, up to 13.0%, through 2021. Payments of interest only are due monthly.</font></p>" id="sjs-J44">&lt;p style="margin: 0; text-align: justify">&lt;font style="font: 10pt Times New Roman, Times, Serif">The interest rate for the first year is 12.0% and increases 0.5% per year, up to 13.0%, through 2021. Payments of interest only are due monthly.&lt;/font>&lt;/p>
Convertible Promissory Note Two [Member]
Total Debt													2,394,774			2,394,774
Interest rate			7.50%		7.50%
Conversion price			$ 4.50		$ 4.50
Debt instrument maturity date			Dec. 7, 2019		Jan. 25, 2020
Convertible Promissory Note One [Member]
Total Debt																		1,469,388
Interest rate										12.00%
Interest rate escalation description									<font style="font: 10pt Times New Roman, Times, Serif">The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.0%.</font></p>" id="sjs-J53">&lt;p style="margin: 0pt">&lt;font style="font: 10pt Times New Roman, Times, Serif">The promissory note bears interest at 12.0% for year one and escalates 0.5% per year thereafter up to 13.0%.&lt;/font>&lt;/p>
Conversion price										$ 4.50
Debt instrument maturity date									Feb. 1, 2021	Jun. 26, 2019
Convertible Promissory Note One [Member] | Minimum [Member]
Interest rate									12.00%
Convertible Promissory Note One [Member] | Maximum [Member]
Interest rate									13.00%
Convertible Promissory Note [Member]
Total Debt																		640,010
Interest rate												12.00%
Conversion price												$ 4.50
Debt instrument maturity date												Feb. 21, 2019
Convertible Promissory Note Three [Member]
Total Debt													$ 580,887			$ 580,887
Interest rate		7.50%
Conversion price		$ 4.50
Debt instrument maturity date		Mar. 7, 2020
[1]	Adjusted to reflect the one for 15 reverse stock split. See "Note 1 "Description of Business."

FAIR VALUE MEASUREMENTS (Detail

FAIR VALUE MEASUREMENTS (Details) - USD ($)	Sep. 30, 2018	Jun. 30, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Dec. 31, 2016
Derivative liability - Conversion Feature	$ 2,222,000		$ 9,331,400
Fair value of financial liabilities	2,222,000		9,331,400
Fair Value Measurement Using, Level 1 [Member]
Derivative liability - Conversion Feature
Fair value of financial liabilities
Fair Value Measurement Using, Level 2 [Member]
Derivative liability - Conversion Feature
Fair value of financial liabilities
Fair Value Measurement Using, Level 3 [Member]
Derivative liability - Conversion Feature	2,222,000	$ 1,891,400	9,331,400	$ 4,639,000	$ 3,163,000	$ 6,987,000
Fair value of financial liabilities	$ 2,222,000		$ 9,331,400

FAIR VALUE MEASUREMENTS (Deta_2

FAIR VALUE MEASUREMENTS (Details 1) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Liabilities measured at fair value Beginning Balance			$ 9,331,400
Change in Fair Market Value of Conversion Feature	$ 103,600	$ 1,475,900	(524,400)	$ (1,122,050)
Fair Value of Derivative Liability Recorded Upon Issuance of Convertible Debt			12,686,000	7,881,000
Liabilities measured at fair value Ending Balance	2,222,000		2,222,000
Fair Value Measurement Using, Level 3 [Member]
Liabilities measured at fair value Beginning Balance	1,891,400	3,163,000	9,331,400	6,987,000
Change in Fair Market Value of Conversion Feature	103,600	1,475,900	(524,400)	(1,122,050)
Derivative Debt Converted into Equity	(3,699,000)	(3,434,900)	(19,271,000)	(9,106,950)
Fair Value of Derivative Liability Recorded Upon Issuance of Convertible Debt	3,926,000	3,435,000	12,686,000	7,881,000
Liabilities measured at fair value Ending Balance	$ 2,222,000	$ 4,639,000	$ 2,222,000	$ 4,639,000

FAIR VALUE MEASUREMENTS (Deta_3

FAIR VALUE MEASUREMENTS (Details 2)	9 Months Ended
	Sep. 30, 2018$ / shares
Stock Price	$ 2.08
Annual Dividend Yield	0.00%
Derivative Liabilities [Member] | Monte Carlo Simulation [Member]
Annual Dividend Yield	0.00%
Derivative Liabilities [Member] | Black-Scholes-Merton option pricing model [Member]
Annual Dividend Yield	0.00%
Minimum [Member]
Expected Life (Years)	6 years
Risk-Free Interest Rate	2.50%
Expected Volatility	124.40%
Minimum [Member] | Derivative Liabilities [Member] | Monte Carlo Simulation [Member]
Stock Price	$ 1.76
Conversion and Exercise Price	$ 1.41
Expected Life (Years)	9 months 25 days
Risk-Free Interest Rate	2.32%
Expected Volatility	94.00%
Minimum [Member] | Derivative Liabilities [Member] | Black-Scholes-Merton option pricing model [Member]
Stock Price	$ 2.08
Conversion and Exercise Price	$ 1.98
Expected Life (Years)	4 months 28 days
Risk-Free Interest Rate	1.77%
Expected Volatility	62.36%
Maximum [Member]
Expected Life (Years)	6 years 6 months
Risk-Free Interest Rate	2.90%
Expected Volatility	128.00%
Maximum [Member] | Derivative Liabilities [Member] | Monte Carlo Simulation [Member]
Stock Price	$ 2.88
Conversion and Exercise Price	$ 2.29
Expected Life (Years)	1 year 6 months
Risk-Free Interest Rate	2.70%
Expected Volatility	104.30%
Maximum [Member] | Derivative Liabilities [Member] | Black-Scholes-Merton option pricing model [Member]
Stock Price	$ 6.90
Conversion and Exercise Price	$ 6.60
Expected Life (Years)	2 years 5 months 1 day
Risk-Free Interest Rate	2.81%
Expected Volatility	103.43%

TAX EXPENSE (Details)

TAX EXPENSE (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Deferred Income Tax Assets:
Net Operating Losses	$ 12,471,322	$ 8,023,000
Deferred Income Tax Assets	12,471,322	8,023,000
Deferred Income Tax Liabilities:
Depreciation	(933,048)	(850,000)
Total	11,538,274	7,173,000
Valuation Allowance	(11,538,274)	(7,173,000)
Net Deferred Tax

TAX EXPENSE (Details Narrative)

TAX EXPENSE (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Tax Expense Details Nattative Abstract
Net operating loss carry forwards	$ (40,106,668)	$ (26,333,000)
Net operating loss carry forwards expiring year	2,034
Provisional tax benefit		3,300,000
Valuation Allowance	$ (11,538,274)	$ (7,173,000)

EQUITY (Details Narrative)

EQUITY (Details Narrative) - USD ($)	3 Months Ended	9 Months Ended
	Mar. 31, 2018	Sep. 30, 2018	Sep. 30, 2017
Common Stock Issued Upon Conversion		13,414,287
Common stock shares cancelled		24,510
Value of common stock shares cancelled		$ 117,831
Common stock shares issued for services		49,982
Common stock value issued for services		$ 133,587
Common stock shares issued for compensation		188,138
Common stock value issued for compensation		$ 589,959
Common stock shares issued upon exercise of warrants or rights		252,703
Proceeds from exercise of warrants or rights		$ 101,000
Amount of asset purchased		300,000
Asset purchased, consideration paid in cash		100,000
Asset purchased, consideration payable		$ 200,000
Asset purchased shares issuable for consideration payable		53,332
Common stock shares issued, stock split		46,687
Tech Center Drive [Member]
Business acquisition working capital adjustments amount withheld	$ 351,072
Business acquisition, shares cancelled due to working capital adjustments	101,083
Senior secured convertible promissory notes [Member]
Debt conversion converted amount		$ 42,968,230
Common Stock Issued Upon Conversion		13,414,287
Accredited investor [Member]
Common stock shares sold		2,166,205
Proceeds from sale of common stock		$ 5,100,000
Director [Member]
Common stock shares issued for services		49,500
Common stock value issued for services		$ 100,000

STOCK-BASED COMPENSATION (Detai

STOCK-BASED COMPENSATION (Details) - 2016 Equity Incentive Plan [Member]	Sep. 30, 2018shares
Awards Reserved for Issuance	30,000,000
Awards Issued	2,552,731
Awards Available for Grant	27,447,269

STOCK-BASED COMPENSATION (Det_2

STOCK-BASED COMPENSATION (Details 1) - USD ($)	3 Months Ended
	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018
Number of Options
Options/Warrants outstanding - beginning balance	2,044,399	1,977,732	1,177,732
Options Granted	945,000	66,667	800,000
Options Forfeited
Options Exercised
Options Expired	(436,668)
Options/Warrants outstanding - ending balance	2,552,731	2,044,399	1,977,732
Options Exercisable	819,409	828,941	659,774
Weighted average exercise price
Options/Warrants outstanding - beginning balance	$ 3.10	$ 3.08	$ 2.17
Options Granted	2.02	3.75	4.41
Options Forfeited
Options Exercised
Options Expired	2.36
Options/Warrants outstanding - ending balance	2.83	3.10	3.08
Options Exercisable	$ 2.66	$ 2.38	$ 2.20
Weighted average remaining contracted term
Options outstanding - ending balance	9 years 1 month 27 days	8 years 10 months 20 days	9 years 1 month 6 days
Options exercisable	8 years 6 months 3 days	8 years 5 months 1 day	8 years 6 months
Aggregate intrinsic value
Options outstanding - ending balance	$ 258,666	$ 361,800	$ 522,600
Options Exercisable	$ 189,861	$ 301,500	$ 391,950

STOCK-BASED COMPENSATION (Det_3

STOCK-BASED COMPENSATION (Details 2)	9 Months Ended
	Sep. 30, 2018
Dividend Yield	0.00%
Minimum [Member]
Expected Term (years)	6 years
Volatility	124.40%
Risk-Free Interest Rate	2.50%
Maximum [Member]
Expected Term (years)	6 years 6 months
Volatility	128.00%
Risk-Free Interest Rate	2.90%

STOCK-BASED COMPENSATION (Det_4

STOCK-BASED COMPENSATION (Details 3) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Stock-Based Compensation Expense	$ 837,502	$ 849,796	$ 2,468,921	$ 3,224,285
Stock Options [Member]
Number of Shares or Options Granted	945,000	132,051	1,811,667	682,051
Stock-Based Compensation Expense	$ 690,686	$ 234,580	$ 1,645,384	$ 439,599
Employees (Common Stock) [Member]
Number of Shares or Options Granted	14,744	49,815	188,138	158,867
Stock-Based Compensation Expense	$ 36,959	$ 170,148	$ 589,951	$ 490,880
Employees (Series A Preferred Stock) [Member]
Number of Shares or Options Granted	4		4
Stock-Based Compensation Expense	$ 8		$ 8
Employees (Series B Preferred Stock) [Member]
Number of Shares or Options Granted				40,000
Stock-Based Compensation Expense				$ 1,035,406
Directors (Common Stock) [Member]
Number of Shares or Options Granted	49,500		49,500	81,061
Stock-Based Compensation Expense	$ 99,991		$ 99,991	$ 221,973
Non-Employee Consultants (Common Stock) [Member]
Number of Shares or Options Granted	5,700	135,172	49,982	325,772
Stock-Based Compensation Expense	$ 9,858	$ 445,068	$ 133,587	$ 1,036,427

STOCK-BASED COMPENSATION (Det_5

STOCK-BASED COMPENSATION (Details Narrative)	9 Months Ended
	Sep. 30, 2018USD ($)$ / shares
Stockbased Compensation Details Narrative Abstract
Closing stock price | $ / shares	$ 2.08
Unrecognized stock-based compensation | $	$ 4,525,434
Weighted-average period	1 year 8 months 25 days

WARRANTS (Details)

WARRANTS (Details) - $ / shares	3 Months Ended			9 Months Ended
	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Sep. 30, 2018
Shares
Options/Warrants outstanding - beginning balance	2,044,399	1,977,732	1,177,732	1,177,732
Warrants Exercised
Options/Warrants outstanding - ending balance	2,552,731	2,044,399	1,977,732	2,552,731
Weighted Average Exercise Price
Options/Warrants outstanding - beginning balance	$ 3.10	$ 3.08	$ 2.17	$ 2.17
Warrants Exercised
Warrants Granted	2.02	3.75	4.41
Options/Warrants outstanding - ending balance	$ 2.83	$ 3.10	$ 3.08	$ 2.83
Warrant [Member]
Shares
Options/Warrants outstanding - beginning balance	1,018,822	1,022,306	1,191,367	1,191,367
Warrants Exercised	(27,778)	(27,800)	(283,697)
Warrants Granted	149,789	51,026	114,636
Warrants Expired		(26,710)
Options/Warrants outstanding - ending balance	1,140,833	1,018,822	1,022,306	1,140,833
Weighted Average Exercise Price
Options/Warrants outstanding - beginning balance	$ 3.25	$ 3.80	$ 2.85	$ 2.85
Warrants Exercised	0.90	0.90	2.17
Warrants Granted	1.98	2.94	4.05
Warrants Expired		3.09
Options/Warrants outstanding - ending balance	$ 3.14	$ 3.25	$ 3.80	$ 3.14

WARRANTS (Details 1)

WARRANTS (Details 1) - $ / shares	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Stock Price on Date of Grant	$ 2.08
Expected Dividend Rate	0.00%
Warrant [Member]
Stock Price on Date of Grant	$ 2.70	$ 4.42
Exercise Price	$ 2.89	$ 5.07
Volatility	116.50%	130.03%
Term	5 years	5 years
Risk-Free Interest Rate	2.70%	1.63%
Expected Dividend Rate	0.00%	0.00%

SEGMENT INFORMATION (Details)

SEGMENT INFORMATION (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Total Revenues	$ 7,083,225	$ 10,121,375	$ 24,416,768	$ 24,788,704
Cost of Goods Sold	5,559,520	7,786,437	19,037,200	20,588,330
Gross Profit	1,523,705	2,334,938	5,379,568	4,200,374
Selling, General and Administrative Expenses	9,404,945	6,238,110	25,829,863	18,653,697
Loss from Operations	(7,881,240)	(3,903,172)	(20,450,295)	(14,453,323)
Other Income Expense:
Amortization of Debt Discount	(498,961)	(490,068)	(1,384,641)	(1,616,338)
Impairment of Property		138,037		138,037
Share of Loss in Joint Venture	439,354		439,354
Interest Income (Expense)	(425,160)	(119,650)	(1,016,160)	(407,993)
Gain on Settlement of Contingent Consideration				4,991,571
Total Other Income (Expense)	(5,724,104)	(3,597,193)	(14,431,507)	(4,526,927)
Herbs and Produce Products [Member]
Total Revenues	1,183,471	1,432,500	3,970,161	4,126,710
Cost of Goods Sold	782,686	1,192,251	3,004,497	3,487,795
Gross Profit	400,785	240,249	965,664	638,915
Selling, General and Administrative Expenses	1,156,272	874,141	3,093,545	2,389,203
Loss from Operations	(755,487)	(633,892)	(2,127,881)	(1,750,288)
Other Income Expense:
Amortization of Debt Discount
Loss on Extinguishment of Debt
Impairment of Property
Gain (Loss) on Fair Market Valuation of Derivatives
Share of Loss in Joint Venture
Interest Income (Expense)
Loss on Fair Market Valuation of Contingent Consideration
Gain on Settlement of Contingent Consideration
Total Other Income (Expense)
Net Loss	(755,487)	(633,892)	(2,127,881)	(1,750,288)
Total assets	6,152,630	6,914,892	6,152,630	6,914,892
Cannabis Dispensary Cultivation and Production [Member]
Total Revenues	5,842,131	8,673,560	20,360,656	20,609,917
Cost of Goods Sold	4,776,834	6,594,186	16,032,703	17,100,535
Gross Profit	1,065,297	2,079,374	4,327,953	3,509,382
Selling, General and Administrative Expenses	2,829,382	2,822,488	9,656,613	7,659,968
Loss from Operations	(1,764,085)	(743,114)	(5,328,660)	(4,150,586)
Other Income Expense:
Amortization of Debt Discount
Loss on Extinguishment of Debt
Impairment of Property
Gain (Loss) on Fair Market Valuation of Derivatives
Share of Loss in Joint Venture	(439,354)		(439,354)
Interest Income (Expense)		51	(396)	51
Loss on Fair Market Valuation of Contingent Consideration				(4,426,047)
Gain on Settlement of Contingent Consideration				4,991,571
Total Other Income (Expense)	(439,354)	51	(439,750)	565,575
Net Loss	(2,203,439)	(743,063)	(5,768,410)	(3,585,011)
Total assets	71,160,430	68,290,922	71,160,430	68,290,922
Eliminations And Other [Member]
Total Revenues	57,623	15,315	85,951	52,077
Cost of Goods Sold
Gross Profit	57,623	15,315	85,951	52,077
Selling, General and Administrative Expenses	5,419,291	2,541,481	13,079,705	8,604,526
Loss from Operations	(5,361,668)	(2,526,166)	(12,993,754)	(8,552,449)
Other Income Expense:
Amortization of Debt Discount	(498,961)	(490,068)	(1,384,641)	(1,616,338)
Loss on Extinguishment of Debt	(4,257,029)	(1,373,538)	(12,115,752)	(4,052,133)
Impairment of Property		(138,037)		(138,037)
Gain (Loss) on Fair Market Valuation of Derivatives	(103,600)	(1,475,900)	524,400	1,122,050
Share of Loss in Joint Venture
Interest Income (Expense)	(425,160)	(119,701)	(1,015,764)	(408,044)
Loss on Fair Market Valuation of Contingent Consideration
Gain on Settlement of Contingent Consideration
Total Other Income (Expense)	(5,284,750)	(3,597,244)	(13,991,757)	(5,092,502)
Net Loss	(10,646,418)	(6,123,410)	(26,985,511)	(13,644,951)
Total assets	37,331,597	12,151,701	37,331,597	12,151,701
Segment Information [Member]
Total Revenues	7,083,225	10,121,375	24,416,768	24,788,704
Cost of Goods Sold	5,559,520	7,786,437	19,037,200	20,588,330
Gross Profit	1,523,705	2,334,938	5,379,568	4,200,374
Selling, General and Administrative Expenses	9,404,945	6,238,110	25,829,863	18,653,697
Loss from Operations	(7,881,240)	(3,903,172)	(20,450,295)	(14,453,323)
Other Income Expense:
Amortization of Debt Discount	(498,961)	(490,068)	(1,384,641)	(1,616,338)
Loss on Extinguishment of Debt	(4,257,029)	(1,373,538)	(12,115,752)	(4,052,133)
Impairment of Property		(138,037)		(138,037)
Gain (Loss) on Fair Market Valuation of Derivatives	(103,600)	(1,475,900)	524,400	1,122,050
Share of Loss in Joint Venture	(439,354)		(439,354)
Interest Income (Expense)	(425,160)	(119,650)	(1,016,160)	(407,993)
Loss on Fair Market Valuation of Contingent Consideration				(4,426,047)
Gain on Settlement of Contingent Consideration				4,991,571
Total Other Income (Expense)	(5,724,104)	(3,597,193)	(14,431,507)	(4,526,927)
Net Loss	(13,605,344)	(7,500,365)	(34,881,802)	(18,980,250)
Total assets	$ 114,644,657	$ 87,357,515	$ 114,644,657	$ 87,357,515

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - USD ($)		Oct. 05, 2018	Sep. 07, 2018	Oct. 23, 2018	Oct. 22, 2018	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Aug. 31, 2018
Principal amount of debt converted						$ (8,900,000)	$ (3,250,000)	$ (26,800,000)	$ (11,814,324)
Accrued interest converted						$ (118,041)	$ (232,225)	$ (311,320)	$ (506,985)
Common Stock Issued Upon Conversion	[1]					6,111,043	1,668,902	13,414,287	5,769,600
North Fourth LLC [Member] | Standard Purchase Agreement [Member
Property to be purchased under agreement, purchase price										$ 2,700,000
Subsequent Event [Member]
Description of shelf registration			The shelf registration was declared effective by the SEC, on October 11, 2018. The registration statement will allow the Company to issue, from time to time at prices and on terms to be determined at or prior to the time of the offering, shares of our common stock, par value $0.001 per share (our “Common Stock”), shares of our preferred stock, par value $0.001 per share (our “Preferred Stock”), debt securities, warrants, rights, or purchase contracts, either individually or in units, with a total value of up to $100,000,000
Class of warrants, rights and debt securities authorized under shelf registration			$ 100,000,000
Subsequent Event [Member] | 2018 Master Securities Purchase Agreement [Member]
Principal amount of debt converted								$ 1,500,000
Accrued interest converted								$ 333,334
Common Stock Issued Upon Conversion								998,244
Subsequent Event [Member] | Investor agreement [Member]
Common stock shares issued upon settlement of put notice				262,956
Proceeds from issuance of common stock				$ 500,000
Subsequent Event [Member] | Exhale Brands Nevada III, LLC [Member]
Proceeds from sale of assets					$ 6,250,000
Description of disposition of assets					The disposition (the "Disposition"), previously announced on July 12, 2018, of substantially all of the assets of the Company related to the Company's dispensary located at 1921 Western Ave., Las Vegas, NV 89102 (the "Business") to Exhale Brands Nevada III, LLC (the "Purchaser") for aggregate consideration of $6,250,000 in cash plus the value of any inventory of the Business on the closing date
Subsequent Event [Member] | North Fourth LLC [Member] | Standard Purchase Agreement [Member
Payments to acquire real estate property		$ 1,100,000
Subsequent Event [Member] | North Fourth LLC [Member] | Standard Purchase Agreement [Member | Promissoy note payable [Member]
Issuance of convertible debt		$ 1,600,000
Description for interest rate		The interest rate for the first year is 12.0% and increases 0.5% per year through 2021. Payments of interest only are due monthly. The full principle balance and accrued interest are due at maturity on November 1, 2021
[1]	Adjusted to reflect the one for 15 reverse stock split. See "Note 1 "Description of Business."